EXCHANGE 


r 


Report  of  Proceedings 


of  the 


American 
Mining 


Congress 


Seventeenth  Annual  Session 

PHOENIX,  ARIZONA 
December  7-11,  1914 


Published  by  the 

AMERICAN  MINING  CONGRESS 

At  the  Office  of  the  Secretary 

Denver,  Colorado 

1915 


E.  A,  MONTGOMERY, 

Director,  Los  Angeles.  Ca! 


SAMUEL  A.  TA" 


D.  V.  BRUNTON, : 

MT,    •  Dtavtr.Coto. 


CARL  SCHOLZ, 

President  of  American  Minine  < 


L.  A,  FRIEDMAN,          Wm    ..  JAMES  F,  CALLBREATH      V  E.  L.  WOLCOTT,  '  .,       1M  FALCON  JOSUN, 

Director,  Lovelocks,  Nev.  KM    Secretary,  Denver,  Colo.  A      *•****»*  SeowUry,  Denver,  Colo;     R*l    Director,  Fairbanks,  AUska 


OFFICERS  AND  DIRECTORS.  1915 


Report  of  Proceedings 


OF  THE 


American  Mining 
Congress 


Seventeenth  Annual  Session 

Phoenix,  Arizona 
December  7-11 

1914 


Published  by  the 

American  Mining  Congress 

At  the  Office  of  the  Secretary 

Denver,  Colorado 

1915 


PREVIOUS  SESSIONS  OF   CONGRESS 


DATE. 

CITY. 

PRESIDENT. 

1st 

July, 

1897* 

Denver,  Colo. 

Hon.   Alva  Adams, 

1st 

July, 

1897 

Denver,     Colo. 

Hon.  L.   Bradford  Prince, 

2d 

July, 

1898 

Salt  Lake  City.  Utah, 

Hon.  L.  Bradford  Prince, 

3d 

July, 

1899f 

Milwaukee,  Wis. 

Col.   B.  F.  Montgomery, 

3d 

June, 

1900 

Milwaukee,   Wis. 

Col.   B.  F.  Montgomery, 

4th 

July, 

1901 

Boise,    Idaho. 

Hon.  L.   Bradford  Prince, 

5th 

Sept., 

1902 

Butte,    Mont. 

K    L.    Shafner, 

6th 

Sept., 

1903 

Deadwood    and 

Lead.  S.  D. 

Hon.  J.  H.  Richards, 

7th 

Aug., 

1904 

Portland,    Ore. 

Hon.  J.  H.  Richards, 

8th 

Nov., 

1905 

El  Paso,    Texas. 

Hon.  J.  H.  Richards, 

9th 

Oct., 

1906 

Denver,  Colo. 

Hon.  J.  H.  Richards, 

10th 

Nov., 

1907 

Joplin,  Mo. 

Hon.  J.  H.  Richards, 

llth 

Dec., 

1908 

Pittsburgh,    Pa. 

Hon.  J.  H.  Richards, 

12th 

Oct., 

1909 

Goldfield,    Nev. 

Hon.  J.  H.  Richards, 

13th 

Oct., 

1910 

Los    Angeles,    Cal. 

Dr.  EJ.  R.  Buckley, 

14th 

Oct, 

1911 

Chicago.    111. 

John  Dern, 

15th 

Nov., 

1912 

Spokane,   Wash. 

Samuel  A.    Taylor, 

16th 

Oct, 

1913 

Philadelphia,    Pa. 

David  W.   Brunton, 

17th 

Dec., 

1914 

.Phoenix,  Ariz.^  ^ 

viari  Scholz, 

*Temporary. 

t  Passed 

to  Ju 

.*&,  ;HH)4j  „•„..«.      * 

.     -  '  * 

ADDRESS. 
Pueblo,   Colo. 
Santa  Fe,  N.  M, 
Santa  Fe,  N.  M, 
Cripple  Creek,  Colo. 
Cripple  Creek,  Colo. 
Santa  Fe,  N.  M. 
Cleveland,  Ohio. 

Boise,  Idaho. 
Boise,  Idaho. 
Boise,  Idaho. 
Boise,  Idaho. 
Boise,  Idaho. 
Boise,  Idaho. 
Boise,  Idaho. 
Rolla.    Mo. 
SaltLakeCity.ITtah 
Pittsburgh,   Pa. 
Denver,   Colo. 
Chicago,  III. 


INDEX 


Alaskan  Question,  Report  on 153 

Annual  Assessment  Work,  Proposed  Law  Concerning 62 

Auditing  Committee's  Report 93 

By-Laws,  Amendment  of Ill,  115 

Communications 58,   59,  60,   61 

Compulsory  Arbitration,  Appointment  of  Committee  on 84 

Financial  Statement  of  Secretary 108 

Mine  Accidents,  Report  of  Committee  on 63 

Mining  Investments,   Report  of  Committee  on J>5 

Nominating  Committee,   Report  of 126 

Officers  and  Directors,  Announcement  of 97 

Resolutions,   Committee   on 26 

Report  of 62,  93,  94,  95,  101,  104.  107 

Revision  of  Mineral  Land  Laws,  Report  of  Committee  on 65 

Taxation,  Report  of  Committee  on 27 

Workmen's  Compensation,  Report  of  Committee  on 80 


SPEAKERS 


Allen,  R.  C Response  to  Address  of  Welcome 20 

Debate  on  Mine  Taxation 35-52 

Bass, Debate  on  Mining  Investments 57-58 

Discussion  Concerning  Federal  Land  Leasing- 79 

Congratulatory   Remarks    102 

Beddow,  Rees  H Debate   on  Proposed  Law   to   Suspend   Assessment 

Work  for  1914 62-63 

Benton,  Harry  J Debate   on    Mining   Investments 56-58 

Bond,  Josiah  Discussion   Concerning  "What  Is  the  Matter  With 

Mining?"    85-86 

Brunton,    Fred  K Response  to  Address  of  Welcome 19 

Burgess.    Charles    W Response  to  Address  of  Welcome 19-20 

Callbreath,    James    F Announcements 25.    26, 

27,    53,    54,   58,  59,    61.  63,    73,    80,   84,    93.    97,    111,    126 

Debate  on  Mining  Investments 55-56 

Concerning  Report  of  Committee   on   Mine  Invest- 
ments    63-65 

Debate  on  Compulsory  Arbitration 82-84 

Debate  on  Resolution  No.   2 93 

Debate  on  Resolution  No.  4 94 

Debate  on  Resolution  No.   5 95 

Speech   of   Thanks 97-100 

Debate  on  Resolution  C 107 

Discussion  Concerning   "What  Is  the  Matter   With 

Mining?1' 89-91 

Report  on  Finances 108-110 

Discussion  Concerning  Change  in  By-Laws 112-115 

Debate   on  Needs  of  Western   Mining 115 

Campbell, Debate  on  Mine  Taxation 33-35 

Cates.  L.   S Debate   on    Mine    Taxation 41 

Carmichael,  Norman Speaking  for  the  Committee  on  Resolutions 84 

Reports  of  Committee  on  Resolutions 

93,    94,   95,   101,    103,    104,   106,    107 

Chalmers, On  Raising  Capital  for  Mining 124 


INDEX 


ADDRESSES 


The  President's  Annual  Address Carl  Scholz,  Chicago,  111.  123 

Recent  Legislation  Affecting  the  Arizona  Mining  Industry, 

Walter  Douglas,  Eisbee,  Arizona  14tl 

The  First  Move Walter  G.    Swart,  Denver,    Colo.  144 

The  Leasing  System  and  Conservation Jesse  Knight,  Provo,  Utah  150 

Federal  Legislation  for  Alaska Falcon  Joslin,   Fairbanks,   Alaska  153 

Conservation  of  Mineral  Resources:  State  or  National, 

Dr.  William  B.  Phillips,  Austin,  Texas  160 
What  Must   Be  Done   to  Stimulate  the  Mining  Industry, 

E'.  P.   Spalding,  Spokane,  Wash.  167 
The  Proper  Advertising  of  Mining  Opportunities, 

Dr.  James  E.   Talmage,  Salt  Lake  City,  Utah  172 

The  Mining  Industry  of  Arizona Charles  B.  Clapp,  Tucson,  Arizona  177 

Conservation   of  Western   Water  Power  Resources, 

E.  A.  Wedgwood,  Salt  Lake  City,  Utah  181 

Give  the  Miner  a  Square  Deal J.   C.  Thoresen,  Salt  Lake  City,  Utah  190 

E  Pluribus  Unum Edward  G.   Reinert,   Denver,   Colo.  193 

Acetylene  Mine  Lighting .A.  Cressy  Morrison,  New  York  City  200 

A  Federal  Leasing  System John  F.   Shafroth,  Denver,  Colo.  207 

Why  Optimism? George  Otis  Smith,  Washington,   D.   C.  2L7 

The  Adjustment  of  Industrial  Disputes  Affecting  the  Public  Service, 

James  A.  Emery,  Washington,  D.  C.  227 

Compulsory  Arbitration Samuel  O.  Dunn,   Chicago,  111.  230 


RESOLUTIONS 


No.  Subject. 

1     Exportation  of  Copper. 


Introduced    by       Page 
George  H.    Dern 53 


2  Mining  Law  Revision Will  L.  Clark 

3  Mineral  Lands  on  Indian  Re- 

serves     , 


4     Federal    Aid   for    Mining 
Schools    


5  Federal   Experiment  Stations. 

6  Uniform   Mine   Signals 

7  Radium    Investigations 

A    Bureau   of  Mines 

B    Mining    Legislation 

C    Thanks.., 


L.   S.   Judd 78 

Charles   H.    Clapp 

and    others 78 

William  B.   Phillips 
and    others 79 

W.  G.  Swart. .  . .  79 


Disposition 
Adopted    

Adopted   as 
Amended    . 

Adopted   as 
Amended    . 

Adopted   as 
Amended    . 


Page 

,  .   62 


.101 


W.  -G.  Swart 79 

Norman    Carmichael.101    Adopted 

Norman    Carmichael.103 

Norman     Cannichael.107     Adopted 


Adopted    Do 

Adopted    9» 

Adopted  as 
Amended    . 


.   95 
.101 

Adopted    104 

.107 


OFFICERS  AND  COMMITTEES,  1915 

OFFICERS. 

CARL  SCHOLZ.   President. 

HARRY    L.    DAY,    First    Vic'e    President. 

M    S.    KEMMERER,    Second    Vice    President. 

GEORGE  H.    BERN,    Third  Vice   President. 

J.   F.   CALLBREATH,   Secretary. 

EXECUTIVE  COMMITTEE 
CARL  SCHOLZ.  CHARLES   S.    KEITH.  WALTER    DOUGLAS. 

DIRECTORS. 

D.  W.  BRUNTON,  Denver,  Colo.  FALCON  JOSLJN.  Fairbanks,  Alaska, 
M.    S.    KEMMERER,   New   York.  SAMUEL  A.  TAYLOR,  Pittsburgh,  Pa. 

E.  A.   MONTGOMERY,   Los   Angeles,       L.  A.  FRIEDMAN,  Lovelocks,  Nev. 
Cal.  CARL  SCHOLZ,  Chicago,  111. 

W.   J.   RICHARDS,   Pottsville,  Pa.  HARRY  L.  DAY,  Wallace,  Idaho. 

GEORGE   H.    DERN,    Salt  Lake   City,     CHARLES  S.  KEITH,  Kansas  City,  Mo. 
Utah.  WALTER  DOUGLAS,  Bisbee,  Ariz. 

COMMITTEES,  1915 

STATE   VICE    PRESIDENTS. 

Alaska— B.   F.   MILLARD,   Valdez.  New   York— CHAS.    H.    SMITH,    New 

Arizona— W.  B.   TWITCHELL,  Phoenix      York. 

Arkansas— C.  C.  WOODSON,  Hunting-    Nevada— C.   B.    LAKENAN,  Lovelock. 

ton.  New  Mexico— T.  H.  O'BRIEN,  Dawson. 

California— CHAS.  E.  KNOX,  Berkeley   Ohio— W.   R.    WOODFORD,   Cleveland. 
Colorado— IRVING  HOWBERT,  Colo-       Oregon— HAROLD    N.    LAWRIE,    Port- 

rado    Springs.  land. 

Georgia— W.  H.   FLUKER.  Thomson.       Oklahoma— JAMES    ELLIOTT,    Mc- 
Idaho— JAMES  F.  MCCARTHY,  Wallace.      Alester. 

Indiana— J.  C.  KOLSEM,  Terre  Haute.    Pennsylvania— MORRIS    WILLIAMS, 
Illinois— F.  W.  DE  WOLF,  Urbana.  Philadelphia, 

Kansas— JOSEPH  FLETCHER,   Fron-     South   Carolina— H.    L.   SCAIFE,   Clin- 

tenac.  ton. 

Massachusetts— FRANKLIN  PLAYTER,  Texas— DR.   W.   B.  PHILLIPS,  Austin 

Boston.  Utah— DR.  J.  E.  TALMAGE,  Salt  Lake 

Michigan— J.  A.  CURTIS,  Detroit.  City. 

Maryland— J.   M.   FITZGERALD,   Baiti-  Virginia— E.  A.   SCHUBERT,    Roanoke. 

more. 

Missouri— W.  L.  SCHMICK,  St.  Louis.  Wisconsin— H.  O.  GRANBERG,  Oshkosh 
Minnesota— F.  O.  HAMMER,  St.  Paul.  Wyoming— W.  D.  BRENNAN,  Cheyenne 
Montana— FRANK  R.  WICKS,  Butte.  West  Virginia— C.  A.  CABELL,  Carbon. 
Nebraska— FRANK  A.  MANLEY,  Washington— COU  W.  T.  PERKINS, 

Omaha.  Seattle. 

REVISION    OF   MINERAL   LAND   LAWS. 
E.    B.   KIRBY,  St.   Louis,   Mo.,    Chairman. 

L.    V.    RAY,    Seward,   Alaska.  E.    B.    KIRBY,    St.    Louis,    Mo. 

WILL  L,   CLARK,   Jerome,   Ariz.  D.   C.   McDONALD,  Ely,   Nev. 

E.  H.  BENJAMIN,  San  Francisco,  Cal.     C.   T.  BROWN,   Socorro,  N.  M. 
VICTOR  C.  ALDERSON,   Denver,  Colo.  H.    H.    SCHWARTZ,   Portland,  Ore. 
J.    H.    RICHARDS,    Boise,   Idaho.  ISADORE    BROMAN,    Austin,    Tex. 

WM,    SCALLON,   Helena,    Mont.  W.   H.    KING,   Salt  Lake  City,   Utah. 

HORACE    V.    WINCHELL.    Minne-        L.  K.  ARMSTRONG,  Spokane,  Wash. 
apolis,    Minn.  EDWIN  HALL,   Lusk,  Wyo. 


OFFICERS   AND   COMMITTEES,    1915 

ALASKAN  AFFAIRS. 

FALCON   JOSLIN,  Fairbanks,  Alaska.     WILLIAM   GRIFFITH,    Scranton,    Pa. 
GEORGE  C.  HAZELIT,  Cordova,  Alaska.T.   C.   McDONALD,    Seattle,   Wash. 
M.  D.  LEEHEY,   Seattle,  Wash. 

WORKMEN'S   COMPENSATION. 

S.   A,   TAYLOR,  Pittsburgh.   Pa.  DAVID  ROSS,   Springfield,   111. 

J.    W.    DAWSON,   Charleston,   W.   Va.     T.    L.    LEWIS,    Bridgeport,    Ohio. 
W.   R.   WOODFORD,   Cleveland,    Ohio. 

PREVENTION   OF   MINE  ACCIDENTS 

W.  R,  INGALLS,   New  York  City,  Chairman. 
DR.  JAMES  DOUGLAS,  New  York  City,  J.  R.   FINLEY,  New  York  City,   N.   Y. 

N.   Y.  JOHN   HAYS  HAMMOND,    New   York 

J.    P.   CHANNTNG,   New  York    City,  City,   N.    Y. 

N.   Y. 

STANDARDIZATION  OF  ELECTRICAL  EQUIPMENT. 
In  Coal  Mines. 

GEORGE  R.   WOOD,  Philadelphia,   Pa.,   Chairman. 

S.   A.  TAYLOR,   Pittsburgh,  Pa.  H.  M.  WARREN,   Scranton,  Pa. 

J.  R.   BENT,  Oglesby,  111.  G.   A.    SCHREIER,    Divernon,   111. 

G.  T.  WATSON,  Fairmont,  W.  Va.  W.   A.    THOMAS,    Pittsburgh,  Pa. 

In    Metal    Mines. 
H.    S.    SANDS,   Denver,    Colo.,    Chairman. 

C.  A.   CHASE,   Denver,  Colo.  SANFORD  B.  BELDEN.  Columbus,  O. 

MINERAL  STATISTICS. 

GEORGE  W.  RITER,  Salt  Lake  City.  Utah,  Chairman. 

OTTO  RUHL,  Joplin,  Mo.  FREDERICK    BURBIDGE,    Spokane, 

Wash. 

FORESTRY    RELATIONS. 

ROBERT  L.   MARTIN,   Denver,    Colo.,   Chairman. 

F.   J.   ALEXANDER.   Denver,   Colo.  HENRY  I.    SEEMAN,   Denver,    Colo. 

J.    W.  DEANE,   Aspen,    Colo.  CARNEY  HARTLEY,   Denver,  Colo. 

MINE   TAXATION 
In    Metal    Mines. 

D.  L,    WEJBB,    Denver,   Colo.  JOHN  WELLINGTON  FINCH,  Denver, 
PROF.  L,  A.  YOUNG,  Urbana,  111.  Colo. 

PROF.  H.  A.  E.  CHANDLER,  Phoenix,  WILL  L.   CLARK,   Jerome,   Ariz. 
Ariz. 

MINING    INVESTMENTS. 

W.    R.    ALLEN,   Butte,   Mont.,    Chairman. 

R,   F.   COLLINS,   Spokane,  Wash.  J.   F.   ERISMAN,   Denver,   Colo. 

JOHN  R.  BURTON.  New  York  City,        CHARLES  A.  MITKE,  Bisbee,  Ariz. 
N.   Y. 

FREIGHT  AND  ORE  TREATMENT   RATES. 

IMER   PETT,   Salt  Lake  City,  Utah.       W.  MONT  FERRY,   Salt  Lake   City, 
HARRY   JOSEPH,    Salt    Lake    City,  Utah. 

Utah.  ARTHUR  THOMAS,   Salt  Lake   City, 

GEO.  H.  DERN,   Salt  Lake  City,  Utah.       Utah. 


OFFICERS  AND  COMMITTEES,  1914 

CARD  SCHOLZ.  President. 

HENNEN  JENNINGS,  First  Vice  President. 

M.   S.  KEMMEREB,   Second  Vice  President. 

HARRY   L.    I>AY,    Third    Vice    President. 

DIRECTORS. 

SAMUEL  A.  TAYLOR,  Pittsburgh,   Pa.  CARL    SCHOLZ,    Chicago,    111. 

D.  W.  BRUNTON,   Denver,  Colo.  HARRY  N.  TAYLOR.  Kansas  City,  Mo. 
HENNEN   JENNINGS,    Washington,        JOHN  MAYER,  Kansas  City,   Mo. 

D.  C.  WILL  L.   CLARK,  Jerome,   Ariz. 

E,  A.    MONTGOMERY,    Los    Angeles,     GEO.  H.  DERN,  Salt  Lake  City,  Utah. 
Cal. 

M.    S.    KEMMERER.    New   York.  HARRY    L.    DAY,    Wallace,    Idaho. 

JAMES  DOUGLAS,  New  York  City.          W.  J.  RICHARDS,  Pottsville,  Pa. 

COMMITTEES 

PROGRAM. 

WILL  L.  CLARK,  Jerome,  Ariz.  W.   G.    SWART,   Denver,    Colo. 

J.  F.  CALLBREATH,   Denver,  Colo. 

REVISION     MINERAL    LAND    LAWS. 

EJ.   B.   KIRBY,    St.    Louis,   Mo.,    Chairman. 

Alaska— -L.  V.  RAY,  Seward.  Minnesota— HORACE  V.  WINCHELL, 

Arizona — WILL  L.   CLARK,   Jerome.  Minneapolis. 

California— E.    H.    BENJAMIN,    San        Missouri— E,   B.   KIRBY,   St.  Louis. 

Francisco.  Nevada — D.  C.  McDONALD,  Ely. 

Colorado— VICTOR  C.  ALDERSON,  New  Mexico— C.  T.   BROWN.   Socorro. 

Denver.  Oregon— H.  H.  SCHWARTZ,  Portland. 

District   of   Columbia— HENNEN   JEN-  Texas— ISADORE  BROMAN,  Austin. 

NINGS,   Washington.  Utah— W.   H.   KING,   Salt  Lake. 

Idaho— J.  H.  RICHARDS,  Boise.  Washington— L,    K.   ARMSTRONG, 

Montana— WM.   SCALLON.  Helena.  Spokane. 

Wyoming— EDWIN  HALL,   Lusk. 

FEDERAL   LEGISLATION. 

Metalliferous    Mining. 

E.  A.  COLBURN,   Denver,  Colo.  DAVID  D.  HOAG,  Joplin,   Mo. 

R.  J.   EVANS,  Salt  Lake  City,   Utah.       J.    C.    ADAMS.    Butte,   Mont. 
IRVIN  E,  ROCKWELL,  Bellevue,  Idaho.  WALTER   DOUGLAS,   Bisbee.  Ariz. 

Alaskan   Affairs. 

FALCON   JOSLIN,    Fairbanks.  SUMNER  S,  SMITH,  Juneau. 

JAS.    R.    HAYDEN,    Seward.  CHARLES  ESTMEREf,  Iditarod. 

WM.    MALONEY,    Nome. 

Coal    Mining. 

W.   L.  SCHMICK,   St.   Louis,    Mo.  CHAS.   M.   MODERWELL,  Chicago.   111. 

HUGH  SHIRKIE,   Terre   Haute,  Ind.       SAMUEL  A.  TAYLOR,  Pittsburgh,  Pa. 
CHAS.  S,  KEITH,  Kansas  City,  Mo.        J.  J.    TIERNE7Y,    Philadelphia,    Pa. 
THOS.   W.    DAVIS,    Saginaw,   Mich.  THOS,  W.  BREWSTER,  St.  Louis,  Mo. 

GEO.   H.  CAPERTON,   Rush  Run,   W.     C.  E.  MAURER,  Cleveland,  Ohio. 
Va.  F.    P.   WRIGHT,  Bevier,  Ky. 

HYWEL  DAVIES,   Lexington,   Ky. 

Workmen's   Compensation. 

S.   A.   TAYLOR,  Pittsburgh,   Pa.  DAVID  ROSS,   Springfield.  111. 

J.  W.   DAWSON,  Charleston,   W.  Va..      T.  L.   LEWIS,  Bridgeport,  Ohio. 
W.   R.  WOODFORD.  Cleveland,  Ohio. 


10  OFFICERS   AND    COMMITTEES,  1914 

Prevention    of    Mine    Accident. 

W.  R.  INGALLS,  Chairman,  New  York  City. 

DR.    JAMES  DOUGLAS,   New  York.         J.    R.    FINLEY,    New   York. 
J.    P.    CHANNING,    New   York.  JOHN  HAYS  HAMMOND,   New  York. 

U.    S.    BUREAU     OF    MINES. 
Metal   Mining. 

E.   H.    BENJAMIN,    San  Francisco,    Chairman. 

IT.   N.    LAWRIE,    Portland,  Ore.  GEO.  E.  COLLINS,   Denver,  Colo. 

J.  F.   MCCARTHY,  Wallace,   Idaho.  W.  B.  SHACKELFORD,  Webb  City,  Mo. 

Coal   Mining. 

E.  T.   BENT,  Chicago.  111.  JOHN  H.   JONES,  Pittsburgh,  Pa. 
MORTON  L.  GOULD,  Indianapolis,  Ind.  ERNEST  CHILSON.  Raleigh,  W.  Va. 

U     S.    GEOLOGICAL   SURVEY. 

J.   F.  MERRILL,  Salt  Lake  City,  Utah.  H.  M.  PARKS,   Corvalis,  Ore. 
DR.  R.  D.  GEORGE,  Boulder,  Colo.  W.   L.    CREDEN,   Butte,   Mont. 

SE'ELEY  W.  MUDD,  Los  Angeles,   Cal. 

STANDARDIZATION  OF  ELECTRICAL  EQUIPMENT. 

In   Coal    Mines. 

GEORGE    R.   WOOD,    Chairma.n,    Philadelphia,    Pa. 

S.   A.   TAYLOR,  Pittsburgh.   Pa,  H.   M.   WARREN,   Scranton,  Pa. 

J.   R.  BENT,   Oglesby,   111.  G.   A.    SCHREIER,    Divernon.   111. 

G.  T.  WATSON,  Fairmont,  W.  Va.  W.   A.    THOMAS,    Pittsburgh,    Pa. 

In    Metal    Mines. 

H.   S.    SAJSFDS,   Chairman.   Denver,   Colo. 

C.  A.    CHASE,    Denver,   Colo.  SANFORD  B.  BELDEN,   Columbus,  O. 

Mineral   Statistics. 

GEORGE  W.  RITER,  Chairman,  Salt  Lake  City,  Utah. 
OTTO  RUHL,   Joplin,   Mo.  FRED'K  BURBIDGE,  Spokane.  Wash. 

COMMITTEE  ON   FORESTRY  RELATIONS. 

General    Committee. 
ROBETRT    L.    MARTIN,    Chairman,    Denver,    Colo. 

F.  J.   ALEXANDER,    Denver,    Colo.  HENRY   I.    SEEMAN,  Denver,    Colo. 
E.  G.  RE1NERT,  Denver,  Colo.  J.  W.  DEANE,  Denver,  Colo. 

Mine  Taxation   (Metalliferous). 

D.  L,   WEBB,  Denver,   Colo.  WILL  L.   CLARK,   Jerome,   Ariz. 
PROF.    L.   A.  YOUNG,  Urbana,   111.  PROF.   H.   A.  E.   CHANDLER,   Phoenix, 
JOHN  WELLINGTON  FINCH,  Denver,      Ariz. 

Colo. 

Mine  Taxation    (Coal). 

R,   V.  NORRIS,   Chairman,    Wilkes-Barre,    Pa. 
WM.  J.  MURRAY,  Denver,  Colo.  W.    W.   KIEFER,  Pittsburgh,   Pa. 

Mining  Investments. 

W.    R.    ALLEN,    Butte,    Mont.  JOHN  R.    BURTON,  New  York   City. 

J.    F.    ERISMAN,   Denver,   Colo.  R.    F.   COLLINS,    Spokane,   Wash. 

LYMAN  A.  SISLEY,  Chicago,  111. 


REPORT  OF  THE  PROCEE0IN&S 

OF  THE 

Seventeenth  Annual  Session  of  the  American 
Mining  Congress 


Elks'  Theatre,  Phoenix,  Arizona 
December  7-11,  1914 


MONDAY,  DECEMBER  7,  1914. 
Opening  Session 
2  O'clock  P.  M. 

The  Congress  was  called  to  order  by  Hon.  Joseph  H.  Kibbey,  chair- 
man Local  Reception  Committee. 

CHAIRMAN  KIBBEY:  Gentlemen,  the  honor  of  calling  this  Congress 
to  order  has  devolved  upon  me,  and  the  first  thing  in  order  will  be  an 
invocation  by  the  Rt.  Rev.  William  J.  Scarlett  of  our  Trinity  Church  pro- 
Cathedral. 

(Invocation.) 

CHAIRMAN  KIBBEY:  On  behalf  of  our  local  committee,  Ex-Gov- 
ernor Sloan  will  now  give  some  expressions  of  appreciation  of  the  honor 
we  feel  for  the  meeting  of  this  Congress  here  in  our  state.  I  have  the 
pleasure  of  presenting  Ex-Governor  Sloan.  (Applause.) 

HON.  R.  E.  SLOAN:  Mr.  Chairman  and  Gentlemen  of  the  American 
Mining  Congress:  I  have  been,  as  the  Chairman  has  said,  delegated  in 
behalf  of  the  local  committee  to  say  a  word — and  it  is  a  very  pleasant  duty 
— of  welcome  to  the  visiting  members  of  the  Congress  and  to  express  our 
appreciation  of  the  honor  conferred  upon  our  town  and  our  state  in  the 
selection  of  Phoenix  as  the  place  for  the  holding  of  your  seventeenth  an- 
nual session.  I  am  also  commissioned  to  say  that  by  the  expressed  wish 
— I  may,  indeed,  say  command — of  your  executive  officers,  we  are  limited 
!in  what  we  may  do  for  you  in  the  way  of  entertainment  of  a  social  char- 
acter. It  was  suggested  to  us  that  the  American  Mining  Congress  is 
composed  of  business  men  who  meet  for  business  purposes  only,  and  that 
social  engagements  therefore  tend  to  interfere  with  the  very  serious  and 
important  work  of  the  convention.  We  appreciate  this  and  we  acquiesce 
in  it.  We  do  appreciate  the  fact  that  the  American  Mining  Congress  is 
a  working  body;  it  was  organized  for  that  purpose;  It  was  organized 
upon  large  plans.  It  was  its  design  as  I  understand,  that  by  this  means 
there  should  be  brought  together  representatives  of  the  various  branches 
of  the  great  basic  industry  of  mining  so  that  these  representatives  might 
confer  together  upon  matters  of  vital  concern  to  the  business  of  mining, 
to  consider  in  a  concrete  way  the  matter  that  immediately  relate  to  min- 
ing. Not  only  so,  but  to  consider  the  more  general  questions,  such  as 
that  of  conservation  of  our  natural  resources,  upon  lines,  however,  that 


12  OFFICIAL     PROCEEDINGS 

will  admit  of  their  broad  development  and  utilization.     Not  only  so,  but 
you  frfcet  to  coiislde^and  it  is  your  purpose  that  you  meet  and  consider 
what  .is  perhaps   sfm  iriore  important — the  conservation  of  human  life 
made  dangerous  by  the  hazards  of  the  occupation  of  mining.     Not  only 
so,-  bst' ihctd-exifeiBy,:'  perhaps,  it  is  your  purpose  to  recommend  from  time 
to  date  needed  legislation  upon  the  subject  of  mining.    Permit  me  to  say 
that  there  is  one  thing  about  the  American  Mining  Congress  that  should 
commend  it,  in  my  judgment,  and  that  is  that  it  has  not  been  organized 
for  the  purpose  of  reforming,  nor  has  it  ever  undertaken  to  reform  any- 
body or  to  uplift  anybody  by  means  of  ill-considered  or  "freak"  legisla- 
tion.   In  my  judgment  laws  are  needed,  but  too  much  law  is  as  bad  and 
possibly  worse  than  too  little  law,  and  there  is  danger  in  the  tendency 
toward  over-legislation  that  our  government  shall  become  top-heavy  in 
this  direction.     You  have  been  active,  however,  in  a  sensible,  business- 
like way  in  effecting  legislation.     I  recall  that  this  Congress  has  been 
instrumental  in  securing  the  Bureau  of  Mines.    I  believe  that  you  are  in  a 
fair  way  also  to  bring  about  a  much-needed  revision  of  the  mineral  laws  of 
the  United  States.     There  is  certainly  room  for  such  an  organization  as 
this,  for  no  other  organization  can  so  well  present  the  views,  the  wishes 
and  the  requirements  of  the  mining  business  to  Congress  and  to  the  state 
legislatures,  and  to   the   country.     There  are  many  functions   that  this 
Congress  has  to  perform  and  will  perform.  Just  now,  when  half  the  world 
is  at  war,  business  and  industries  of  every  kind,  including  mining,  have 
been  feeling  the  effects  of  that  war.     Perhaps  due  to  this  cause  the  field 
of  activity  of  this  Congress  has  been  widened.     Let  me  suggest  another 
thing:  America,  as  well  as  all  the  world,  has  been  at  school  these  last 
four  months,  and  we  have  been  learning  a  valuable  lesson.     Whether 
Germany  shall  succeed  or  fail  in  her  gigantic  effort  to  defeat  her  enemies, 
she  certainly  has  been  giving  the  world  a  valuable  object  lesson  in  effi- 
ciency.   She  has  taught  us  that  exact  scientific  knowledge,  thoroughness 
in  method  and  the  application  of  sound  business  principles  are  essential 
to  industrial  supremacy  as  they  are  to  modern  warfare.     She  has  also 
taught  us  that  no  people  without  these  can  hope  to  compete  in  the  future 
with  a  nation  that  possesses  them.     Now,  this  may  be  a  needed  object 
lesson  for  America,  and  I  think  it  is,  and  that  we  are  beginning  to  realize 
more  and  more  that  the  future  industrial  supremacy  of  our  country  rests 
not  upon  the  richness  and  plentitude  of  our  natural  resources  but  upon 
the  efficiency  of  the  men  and  methods  employed  in  their  development  and 
utilization.     (Applause.)     Now,  I  do  not  know  that  this  lesson  is  particu- 
larly needed  in  the  mining  industry.     To  some  extent  I  presume  it  is; 
but  to  the  extent  that  this  Congress  is  directed — <and  it  seems  to  me  that 
its  work  is  primarily  so  directed — to  the  securing  of  greater  efficiency, 
it  deserves  the  support  and  encouragement  of  us  all  whether  we  are  en- 
gaged in  mining  or  not.    Business,  Gentlemen,  is  a  unit:  whatever  affects 
one  industry  or  one  enterprise  or  one  business  affects  other  industries 
and  other  enterprises  and  other  businesses  to  the  same  extent.    We  real- 
ize that  in  our  own  state,  Arizona,  in  common  with  other  copper-produc- 
ing states,  has  been  feeling  acutely  the  decline  in  copper.    We  have  come 
to  realize  from  this  that  we  are  dependent  in  a  large  measure  upon  that 
industry  for  our  prosperity.     Let  me  suggest  another  thing  in  this  con- 
nection— that  we  should  all  look  with  interest  to  the  course  of  events 
in  so  far  as  our  government  is  concerned  in  dealing  with  this  industry. 
We  should  all  hope,  at  any  rate,  that  our  government  will  be  able  to 
maintain,  and  will  adhere  to,  the  policy  that  copper  in  neutral  vessels 
consigned  to  neutrals  at  neutral  ports  may  not  be  seized  as  contraband 
of  war  by  British  and  French  ships  without  clear  proof  that  Germany  or 
Austria  is  to  be  its  ultimate  destination.    (Applause.)    I  see  from  this  ap- 
plause that  if  any  prop  or  props   in    the    way    of    public  sentiment  are 
needed  to  sustain  our  government  in  that  position  this  Congress  is  ready 
to  supply  them. 

Now,  gentlemen,  it  is  not  my  purpose  to  make  a  speech;  it  is  not  my 


AMERICAN     MINING     CONGRESS  13 

business  to  make  a  speech  to  you.  You  have  a  very  interesting  and  com- 
prehensive program  for  this  session  of  your  Congress.  Permit  me,  in 
closing,  to  express  the  hope  that  it  may  be  carried  out  without  a  break 
and,  that  you  may  all  extract  from  it  and  from  your  visit  to  Phoenix  not 
only  pleasure  but  profit  to  yourselves  and  to  the  interests  you  represent. 
The  Committee,  I  wish  to  say,  is  whole-heartedly  at  your  service  to 
achieve  that  end.  (Applause.) 

CHAIRMAN  KIBBEY :  On  behalf  of  the  state  of  Arizona,  and  speak- 
ing for  the  state  at  large  as  well  as  for  the  city  of  Phoenix,  Hon.  George 
P.  Hunt,  Governor  of  Arizona,  will  now  extend  to  you  some  remarks  of 
welcome.  (Applause.) 

GOVERNOR  HUNT:  Mr.  President,  Gentlemen  of  the  Mining  Con- 
gress :  It  is  with  a  keen  realization  of  the  great  importance  of  this  occa- 
sion that  I  com©  before  you  this  morning  to  address,  in  behalf  of  Ari- 
zona's miningl  men,  the  City  of  Phoenix,  and  the  State  of  Arizona,  a  cor- 
dial welcome  to  the  many  distinguished  visitors  from  other  states  who 
have  come  together  to  participate  in  one  of  the  most  notable  gatherings 
that  annually  marks  America's  industrial  life.  I  speak  with  the  utmost 
certainty  when  I  give  assurance  that  the  mining  men  of  Arizona,  and  the 
representatives  of  the  city  and  state  governments  as  well,  feel  highly 
honored  by  the  holding  of  this  Congress  in  the  Capital  of  the  State,  and 
regard  this  occasion  as  an  exceptional  opportunity  to  demonstrate  the 
whole-hearted  nature  of  Arizona's  hospitality.  We,  who  for  several 
months  past,  have  had  a  part  in  preparing  the  scene  of  this  convention, 
have  freely  given  our  most  earnest  efforts  toward  insuring  our  visitors 
of  sessions  both  pleasureable  and  profitable,  and  even  though  it  should 
prove  that  some  things  have  been  left  undone  for  the  attainment  of  such 
a  purpose,  you  who  have  come  from  afar,  may  at  least  be  assured  of  the 
sincerity  of  our  good  will,  of  our  unqualified  desire  to  please  and  of  our 
deep  personal  satisfaction  in  being  allowed  to  entertain  a  body  of  men 
whose  names,  collectively,  stand  for  all  modern  advancement  in  the  de- 
velopment of  the  mining  industry  throughout  the  United  States.  As 
Governor  of  Arizona,  a  state  comprising  many  colossal  mining  projects, 
whose  reputation  has  gone  abroad  throughout  the  land,  I  warmly  wel- 
come all  of  you,  and  express  the  earnest  desire  that  many  of  you  as  in- 
dividuals may  have  frequent  opportunity  to  revisit  Arizona  and  share  in 
her  business  development. 

For  many  years  past,  with  the  exception  of  two  or  three,  it  has  been 
my  fortune  to  live  in  one  of  the  most  promising  mining  centers  of  this 
state,  and  to  observe,  in  that  connection,  the  vitally  important  part  which 
the  mining  men  of  this  country  have  taken  in  the  development  of  Ari- 
zona's mineral  resources  and  the  consequent  upbuilding  of  our  business 
structure  as  a  whole.  In  the  life  of  the  city,  to  which  I  refer,  and  which 
is  characteristic  of  numerous  centers  of  population  in  Arizona,  the  ar- 
rival of  each  train,  with  the  possibility  that  some  great  captain  of  in- 
dustry might  be  incoming,  constituted  a  very  important  event  of  daily 
recurrence.  This  constant  and  consuming  interest  in  all  newcomers  was 
perfectly  natural  in  the  light  of  the  fact  that  the  arrival  and  departure 
of  many  a  noted  engineer  or  far-famed  capitalist  marked  a  new  con- 
tribution to  the  industry  of  the  entire  mining  district  within  which  my 
home  city  was  situated.  My  chief  purpose  in  dwelling  on  this  particular 
phase  of  Arizona's  industrial  life  is  to  emphasize  the  intimate  and  all- 
important  connection  of  the  mining  industry  to  Arizona's  present  and 
future  welfare.  My  further  object  is  to  illustrate  the  vast  responsibility 
resting  upon  each  captain  of  industry,  who  directs  the  different  mining 
enterprises  of  the  state,  and  who  is  frequently  instrumental  in  opening  up 
new  avenues  of  commerce  tending  to  enrich  this  young  but  vigorous  com- 
monwealth in  which  most  of  us,  who  are  acting  in  the  role  of  host  today, 
have  made  our  homes  for  many  years.  The  picture,  which  I  have  drawn, 
may,  furthermore,  assist  in  enabling  you,  who  are  Arizona's  guests,  to 


14  OFFICIAL     PROCEEDINGS 

realize,  in  some  degree,  how  remarkably  Arizona's  people  are  impressed 
by  the  Tast  significance  of  this  gathering  in  the  Capital  City  of  the  State. 

With  a  consciousness,  therefore,  of  the  important  and  far-reaching 
relation  of  tills  Congress  to  the  mining  industry  of  Arizona,  and  of  the 
entire  United  States  as  well,  we  may  reasonably  anticipate  that  the  ses- 
sions to  be  held  during  the  next  few  days  will  lead  to  the  solution  of 
many  serious  problems  confronting  the  management  of  mining  com- 
panies at  this  particular  period,  and  may  result  in  an  even  greater  meas- 
ure of  harmonious  co-operation  than  has  prevailed  heretofore.  It  is  no 
exaggeration  to  assert  that  the  true  source  of  progress  and  human  well- 
being  is  harmony,  and  that  the  "work-together"  spirit  bears  a  direct  re- 
lation to  civilization's  advancement. 

Although  there  is  a  certain  ineptitude  in  citing  the  German  nation  of 
today  as  an  illustration  of  the  possibilities  to  be  realized  through  co- 
ordination of  efforts,  all  of  us.  who  have  followed  her  career  since  the 
European  war  began,  must  necessarily  have  been  dumbfounded  by  the 
remarkable  spectacle  of  a  great  commercial  empire  being  suddenly 
transformed  into  an  enormous  fighting  machine,  the  maintenance  and 
movement  of  which  have  proceeded  with  the  regularity  of  clockwork. 
Lacking  a  stupendous  endeavor  toward  co-ordination,  such  monumental 
efficiency  could  never  have  been  realized,  and  therein  we  find,  unfortu- 
nately, a  contrast  between  the  German  nation,  where  all  men  work  to- 
gether in  the  common  interest,  and  the  United  States  where  competition 
between  countrymen  and  between  industries  as  well  has  been  carried  to 
the  Nth  power. 

Without  decrying  American  individualism,  is  it  not  possible  for  the 
leaders  of  American  industry  to  immeasurably  accelerate  business  and 
social  advancement  by  instituting  a  new  era  of  co-operation  that  will  ex- 
tend not  only  to  commercial  enterprises,  but  which  may  also  eventually 
be  made  to  characterize  the  conduct  of  our  State  and  National  govern- 
ments in  the  furtherance  of  the  general  welfare?  To  eliminate  needless 
friction  between  individual  industrial  leaders,  between  corporations  and 
proletariat,  and  between  the  employer  and  employed,  is  as  commendable 
and  beneficial  a  purpose  as  could  possibly  animate  our  public  men  of 
today  to  whom  the  guidance  of  mammoth  industries  and  of  govern- 
mental organizations  are  entrusted.  I  firmly  believe  that  no  man  can 
promote  the  welfare  and  happiness  of  others  without,  at  the  same  time, 
reaping  the  greatest  reward  of  all — the  fullest  measure  of  success  in  his 
chosen  line  of  work. 

Should  it  be  possible,  in  the  sessions  of  the  American  Mining  Con- 
gress, to  crystallize  such  a  spirit  of  mutual  helpfulness  and  universal  co- 
operation as  has  been  merely  suggested  by  the  words  which  I  have 
spoken,  a  vastly  significant  movement  will  have  been  inaugurated  and 
this  new  direction  given  to  the  energy  and  thought  of  those  who  are 
members  of  this  gathering  would  surely  and  inevitably  give  the  Ameri- 
can Mining  Congress  an  enviable  and  unprecedented  place  in  the  com- 
mercial history  of  this  country. 

With  all  the  warmth  of  feeling  which  I  possess,  and  with  reassur- 
ance of  Arizona's  hope  that  every  member  may  leave  this  scene,  at  the 
conclusion  of  the  meetings  of  the  next  few  days,  carrying  with  him 
constructive  ideas  for  future  application,  and  pleasant  memories  of  good- 
fellowship,  I  conclude  my  words  of  welcome  to  you  whose  presence  con- 
fers a  new  and  signal  honor  upon  our  state. 

CHAIRMAN  KIBBEY:  Speaking  for  the  people  of  Phoenix,  its 
mayor,  Hon.  George  U.  Young,  will  address  a  word  of  welcome  to  you. 
I  have  the  honor  of  presenting  the  mayor,  Hon.  George  U.  Young.  (Ap- 
plause.) 

MR.  YOUNG:  Mr.  Chairman  and  Delegates  to  the  Sevententh  Annual 
Session  of  the  American  Mining  Congress:  Phoenix,  the  Queen  City  of 


AMERICAN     MIXING     CONGRESS 

the  Southwest,  appreciates  the  honor  conferred  upon  her  in  this  gathering 
of  men,  attempting  things  of  such  mighty  import,  and  from  this  appre- 
ciation there  comes  a  welcome  now  found  only  in  *  partially  free  and 

untrammeled  West. 

It  is  not  onlj  paradoxical,  but  wonderful,  that  a  gathering  of  this 
kind  *"*1  intent  should  exchange  mutual  honors  with  this  wonderful  fittle 
city,  not  yet  fully  alire  to  its  great  mining  possibilities,  and  there  are 
several  of  us  who  will  rejoice  if  this  fact  be  revealed  by  this  particular 
session  of  the  American  Mining  Congress. 

Phoenix,  lithe,  tawny  and  beautiful,  in  her  young  strength,  reclines 
transcendent  and  radiant  as  an  iridescent  dream,  on  her  throne  of  silver. 
copper  and  gold,  filamented.  decorated  and  adorned  with  the  trailing  ar- 
butus, orange  blossoms  and  the  relrety  purple  of  alfalfa  bloom.  The  air, 
laden  with  the  perfume  of  orange,  hyacinth  and  colnmtine.  frm.*  hiHed 
many  to  sleep  in  the  dangerous  realm  of  egotism,  comfort,  peace  and 
prosperity,  and  at  the  worn  out  sentinel's  "All's  well,"  tern  orer  for  an- 
other season  of  rest  and  sleep,  but  there  are  others  of  less  seLlshJie^s, 
greater  experience  and  more  extended  vision,  who  Lare  Vrnwn.  and  do 
know,  that  in  union  there  is  strength,  and  the  greatest  strength  is  found 
when  the  holy  face  of  motherhood  and  angelic  face  of  rhildfrond.  sup- 
ported by  the  brawn  and  strength  of  the  miner,  look  forth  in  happiness 
through  the  wreath  of  KmllaT  and  rose  produced  and  nurtured  17  the 
patience  and  intelligence  of  the  farmer. 

This  is  a  wonderful  gathering  of  men,  upon  which  mighty  respon- 
sibilities rest,  and  a  meeting  held  in  the  most  portentous  true  in  inrziin 
history.  This  statement  is  made  without  fear  of  contradiction  by  the 


Mining  is  the  one  peculiar  industry  known  to  man.  It  is  a  developer 
of  man  as  no  other  vocation,  because  the  weak,  timid  and  cowardly  can 
have  no  place  in  it  and  righteously  do  their  work,  for  the  best  verse! 
man  in  mining-  is  but  a  pioneer  in  an  unknown  realm. 

The  greater  the  proficiency  of  one  in  mjnir^g  the  more  that  one  feels 
his  inefficiency  and  lack  of  knowledge.  There  are  no  permanent  etiiie 
posts  in  this  vast  region,  and  but  few  proven  truths,  therefore,  the  mtr.- 
ing  industry  stands  first  in  all  the  world.  Not  in  money,  income  or  other 
material  things,  but  in  that  power  to  develop  in  the  faithful  and  cour- 
ageous man  those  latent  but  basic  truths,  which,  if  righteously  followed. 
make  better  men  and  women,  a  higher  citizenship  and  a  greater  fiational 
permanency. 

Mining  is  also  the  one  industry  which  has  been  brought  into  the  worst 
repute  by  writers  of  national  fame,  but  colossal  ignorance.  The  "crook" 
and  the  "get-rich-quick  artist"  have  also  utilized  its  possibHiiies  in  prey- 
ing upon  the  duplicity  of  the  equally  as  crooked  or  ignorant  investor,  who 
dreams  his  dream  of  avarice,  and  thinks  he  can  get  valuable  mining  stock 
on  the  basis  of  a  two  to  five  One  Dollar  certificate  for  twenty-five  cents. 

It  has  stood  all  these  buffets,  and  ag-nfn  has  had  to  stand  the  awful 
burden  of  theoretical  mining  engineers,  through  whom  h.as  come  that  vast 
amount  of  wrong  information  now  most  tenaciously  followed  by  the  great 
majority  of  legitimate  investors.  Through  this  class  of  mining  engineers 
—  who  know  nothing  of  the  difference  between  a  money-sp-tnains  ability 
and  a  money-creating  ability  —  investors  have  been  taught  to  believe  mil- 
lions are  required  when  thousands  would  sun^ce,  and  in  many  instances, 
hundreds  would  do  where  thousands  are  demanded.  In  other  words,  the 
lack  of  practical  experience  and  the  application  of  good,  common  sense 
should  inform  the  wise  investor  that  it's  a  pretty  safe  buy  if  he  can  fiad 
a  mining  prospect  that  has  been  turned  down  by  from  ten  to  twenty  of 
this  class  of  raiding  engineers. 

The  application  of  this  theoretical  mining  knowledge  the  past  few 
years,  has  practically  driven  the  prospector  from  the  field  and  has  placed 


16  OFFICIAL    PROCEEDINGS 

the  average  mining  prospect  in  the  same  category  with  the  human  patient 
and  his  physician.  Most  any  ordinary  patient  may  be  able  to  stand  the 
experiments  of  one  physician,  but  when  that  physician  calls  a  consulta- 
tion, and  the  unfortunate  patient  has  to  withstand  the  onslaught  of  all 
of  them,  it  is  a  wise  precaution  for  him  to  make  hiis  will.  The  same  with 
a  mining  prospect,  struggling  along  under  fifteen  different  opinions,  made 
up  by  fifteen  different  engineers. 

Will  this  congress  of  men  realize  its  great  responsibilities  at  this 
session,  and  especially  its  greatest  responsibility,  which  is  the  life  and 
permanency  of  this  great  nation?  Will  you  delegates  keep  in  mind  you 
are  representing  the  one  industry  now  left  which  develops  individuality, 
as  individuality  is  being  destroyed  in  all  other  lines,  and  when  individ- 
uality is  destroyed  that  nation  sooner  or  later  must  fall  and  perish  from 
the  face  of  the  earth 

Will  you  realize  the  pendulum  of  human  progress  is  now  swinging 
backward  in  the  life  of  man,  and  no  man  in  this  great  audience  will  live 
to  see  that  time  again,  when  the  awful  material  fight  for  animal  existence 
can  be  laid  aside,  or  secondly  carried,  while  methods  for  mental  culture 
and  human  advancement  are  being  studied  and  experimentally  applied? 

Our  brothers  in  Europe,  in  less  than  three  months  time,  have  de- 
stroyed the  constructive  efforts  of  centuries  in  human  uplift.  Be  our 
sympathy  where  it  may,  the  ghastly  truth  stands  revealed,  that  should 
the  aggressive  nation  perish,  the  nation  first  in  practically  all  the  sci- 
ences, and  especially  in  the  science  of  Government,  the  most  divine  sci- 
ence of  them  all,  when  that  nation  is  lost  in  the  vortex  of  memory,  it 
drags  with  it  the  work  of  a  world.  May  it  not  be  so, — but  our  brothers 
of  nearer  kin  and  blood  are  having  to  tent  with  the  disciples  of  supersti- 
tion and  ignorance,  because  of  their  own  past  inertia  and  destruction  of 
individuality  in  national  make  up. 

Many  will  say:  "The  United  States  is  left  to  light  the  way."  Possi- 
bly— What  will  be  the  result  of  this,  the  Seventeenth  Session  of  the 
American  Mining  Congress?  We  are  all  familiar  with  the  corruption  of 
corporate  methods  in  the  near  past.  It  made  a  people  mad,  with  the  re- 
sult that  today  this  nation  groans  under  the  weight  of  grievous  legisla- 
tion, and  an  expense  account  under  which  no  nation  can  exist  and  prosper. 

One's  misfortune  is  another's  fortune,  whether  applied  individually  or 
in  the  aggregate,  and  today  we  stand  in  the  dawn  of  an  era  of  national 
prosperity.  It  cannot  last,  because  of  the  impulse  contained  therein,  and 
in  less  than  fifteen  years,  those  of  us  then  living,  will  see  this  great  gov- 
ernment tottering  to  its  very  foundation,  unless  meetings  of  this  character 
perceive  the  weakness  of  the  foundation,  and  have  the  patience,  intelli- 
gence, unselfishness  and  patriotism  to  cease  building  at  the  top  and  com- 
mence lasting  repairs  on  the  foundation,  which  is, — the  expansion  and 
uplift  of  the  individual  man. 

What  are  the  truths  gleaned?  First: — Most  people  know  of  govern- 
ment, but  few  people  know  what  it  is.  Second: — Until  unselfish  and  in- 
telligent instruction  is  taught  of  what  a  sacred  responsibility  the  ballot 
is,  the  preservation  of  this  government  depends  upon  the  limitation,  not 
an  expansion  of  the  franchise.  Who  will  first  start  the  movement  re- 
quiring a  voter  to  pass  an  examination  on  the  subject  of  democratic  gov- 
ernment before  being  allowed  to  vote?  Which  will  be  the  first  mining 
company  to  start  and  support  a  school  where  its  employees  may  be  in- 
structed in  government  taught  by  a  teacher  not  teaching  government  for 
the  benefit  of  that  company  or  the  mining  industry,  but  for  the  general 
uplift  of  democratic  government? 

Few  laws,  plain  ones  and  in  simple  terms,  may  the  delegates  to  this 
Congress  record  themselves  in  favor  of,  and  thus  there  will  come  forth 
from  this  beautiful  little  city,  in  the  land  the  fool  said  "God  forgot,"  the 
first  faint  cry  of  a  new  wisdom  in  Israel. 


AMERICAN     MINING     CONGRESS  17 

As  one  of  the  few  individual  mining  men  of  the  city  of  Phoenix, 
proving  his  faith  by  his  works,  it  is  more  than  a  pleasure  to  welcome  you 
as  men  engaged  in  a  mighty  work. 

As  the  Mayor  of  Phoenix,  it  is  not  only  my  great  pleasure,  but  great 
honor,  to  tell  you  Phoenix  welcomes  you — once,  twice,  thrice — and  em- 
phasizes this  welcome  with  three  cheers  and  a  tiger. 

The  City  Manager  has  been  asked  to  remove  the  lid  for  you  as  far 
as  within  his  power.  We  want  you  to  go  to  your  homes  with  your  hearts 
tilled  with  love  for  Phoenix,  and  as  time  grows  older,  when  you  have 
handed  your  lance  and  armor  to  the  younger  man,  and  you  sit  by  the 
quiet  of  your  fireside,  may  memories  come  to  you  of  this  occasion  as 
sweet  as  the  odor  of  lavender  and  old  rose,  and  may  you  think  of  Phoenix 
as  a  precious  old  cameo,  circled  by  bands  of  gold,  set  in  pictures  of  cop- 
per and  silver,  which  will  be  at  that  time  the  truth,  for  some  of  the  big- 
gest mines  any  country  now  contains  will  be  proven  to  exist  on  the 
fringes  of  these  watchful  waiting  mountains  surrounding  Phoenix. 

Again — Members  of  this  Convention — as  the  Mayor  of  Phoenix,  per- 
mit me,  in  behalf  of  the  people,  Commission,  City  Manager  and  myself,  to 
bid  you  a  gladsome  welcome,  tell  you  the  latch  string  hangs  on  the  out- 
side, bidding  you  enter,  take  what  you  desire,  and  if  there  is  anything 
you  do  desire  and  cannot  find,  kindly  request  it  of  us  and  we  will  be  glad 
to  find  it  for  you. 

CHAIRMAN  KIBBEY:  The  Secretary  of  the  Congress  has  a  letter 
from  the  President  of  the  United  States  which  he  will  read. 

The  White  House,  Washington,  October  2,  1914. 
Mr.  J.  F.  Callbreath,  Secretary, 

American  Mining  Congress,  Washington,  D.  C. 
My  dear  Mr.  Callbreath: 

To  the  Members  of  the  American  Mining  Congress:  I  regret  exceed- 
ingly that  owing  to  the  press  of  circumstances  it  will  be  impossible 
for  me  to  greet  you  in  person  at  the  Seventeenth  Annual  Session  of  the 
American  Mining  Congress,  at  Phoenix,  Arizona,  in  December. 

I  am  well  aware  of  the  important  part  played  by  your  great  organiza- 
tion in  the  creation  of  our  Bureau  of  Mines  and  am  sure  that  the  good 
work  of  that  bureau  in  attempting  better  to  safeguard  the  lives  of  the  two 
million  men  employed  in  the  hazardous  mining  and  metallurgical  indus- 
tries will  continue  to  redound  to  your  credit,  as  well  as  to  the  credit  of 
the  bureau  itself.  It  will  always  be  a  tribute  to  your  foresight  and  energy 
that  this  new  federal  organization,  in  the  short  period  of  its  existence, 
with  the  kindly  co-operation  of  state  and  other  agencies,  has  been  able, 
by  persistent  and  intelligent  effort,  to  turn  an  isolated,  local  movement 
for  greater  safety  into  a  great  national  movement  for  "Safety  First"  that 
has  already  gone  beyond  the  mining  industry  into  every  industry  of  the 
country.  I  venture  to  say  that  thousands  of  lives  have  been  saved  by 
that  movement  and  that  many  thousands  more  will  be  saved  in  the 
future. 

Gratifying  as  the  results  of  this  life-saving  campaign  may  have  been, 
however,  there  is  still  vigorous  work  for  your  Congress  to  do.  I  am  in- 
formed that  during  the  last  year  more  than  three  thousand  men  were 
killed  and  one  hundred  thousand  injured  in  the  mining  and  metallurgical 
industries  of  the  country.  At  the  same  time,  those  in  authority  tell  me 
that  from  their  observation  and  experience  one-half  of  such  deaths  and 
three-fourths  of  such  injuries  may  be  regarded  as  easily  preventable. 

I  suggest  this  situation  as  an  opportunity  for  further  endeavor  on 
your  part  to  cut  down  this  excessive  toll  of  death  and  injury.  I  can  as- 
sure you  of  the  fullest  co-operation  of  all  the  proper  governmental  agen- 


18  OFFICIAL     PROCEEDINGS 

cies;   and  also  of  my  earnest  desire  for  your  active  and  continued  as- 
sistance. 

There  is  one  other  problem  connected  with  the  mining  industry  in 
which  the  Federal  Government  is  vitally  interested,  and  that  is  proper 
conservation  and  proper  use  of  the  mineral  resources  of  the  nation.  I 
realize  that  you,  too,  are  interested  in  this  problem  and  wish  merely  to 
call  it  to  your  attention  because  of  its  fundamental  importance  to  the 
present  and  future  prosperity  of  the  nation.  I  am  happy  to  say  that  the 
profligacy  of  the  past  in  the  use  of  these  resources  is  not  being  con- 
tinued, at  least  not  on  so  large  a  scale.  There  is,  however,  great  oppor- 
tunity for  further  reform  along  these  lines  and  in  this  your  organization 
can  be  of  invaluable  service. 

Sincerely  yours, 

WOODROW  WILSON. 

CHAIRMAN  KIBBEY :  The  President  of  the  Congress  will  respond  to 
the  address  of  welcome,  and  upon  my  presentation  of  him  to  you  my 
functions  will  have  ceased  and  he  will  from  thenceforth  preside  over 
your  deliberations  and  direct  your  further  proceedings.  I  have  the  pleas- 
ure of  presenting  to  you  Mr.  Carl  Scholz,  President  of  the  American 
Mining  Congress.  (Applause.) 

PRESIDENT  SCHOLZ:  Ladies  and  Gentlemen  and  fellow  members 
of  the  American  Mining  Congress:  In  behalf  of  our  organization  I  want 
to  accept  the  very  cordial  and  hospitable  invitation  and  reception  given 
us  by  the  city  of  Phoenix.  It  is  indeed  a  rare  pleasure  to  receive  such 
a  warm  welcome  as  has  been  accorded  to  us  here  today  by  your  former 
Governor,  your  present  Governor,  the  Mayor  of  the  City  and  the  very 
able  Reception  Committee. 

Phoenix  is,  indeed,  a  fitting  place  for  a  meeting  of  this  kind,  being  the 
center  of  a  very  wealthy  mining  district,  one  to  which  this  state  owes  a 
great  deal.  I  am  sorry  that  I,  myself,  know  so  little  about  the  state,  but 
from  what  little  I  have  seen  it  has  indeed  been  a  surprise  to  me.  I  ex 
pected  to  find  Phoenix  a  wild  western  place,  instead  of  which  I  have  beer^ 
pleasantly  disappointed.  These  flowers  do  not  look  like  evidence  of  a 
wild  western  desert;  they  speak  with  a  warth  of  Southern  hospitality 
which  we  so  greatly  appreciate.  Living,  as  many  of  us  do,  in  the  northern 
and  eastern  cities,  where  ice  and  snow  are  now  so  much  in  evidence,  we 
certainly  look  with  much  pleasure  upon  the  signs  of  spring. 

I  regret  that  personally  I  am  very  little  known  to  you  delegates. 
Having  been  engaged  in  the  coal  mining  industry,  my  acquaintance  among 
metal  men  is  rather  limited,  but  I  can  see  right  now  that  in  the  very  few 
days  I  will  be  here  I  shall  make  a  good  many  friends,  because  coal  min- 
ing is  very  closely  allied  to  the  metal  industry. 

So  much  has  been  said  about  the  effect  of  the  foreign  war  upon  the 
industry  that  I  am  not  going  to  trouble  you  with  a  further  discussion  o.^ 
that  subject,  but  I  think  you  will  agree  with  me  that  although  we  are 
surrounded  by  wars  which  interfere  with  our  commerce,  our  industries 
are  progressing  favorably  and  advancing  quite  rapidly. 

I  will  now  open  the  Congress  for  business,  and  will  call  upon  the 
delegates  from  the  various  states  for  their  responses  to  the  eloquent  ad- 
dresses of  welcome  to  which  we  have  listened. 

The  first  on  the  program  is  the  state  of  California,  and  we  will  hear 
from  Mr.  Seeley  W.  Mudd  of  Los  Angeles. 

MR,  MUDD,  of  California:  Mr.  President  and  gentlemen:  I  think  it 
is  hardly  fair  to  a  great  state  like  California  to  have  me  designated  to 
respond  in  her  behalf,  and  especially  upon  sudden  notice.  It  is  a  great 
state,  and  the  response  should  be  a  great  one  by  a  great  man.  I  am  sorrv 
that  it  cannot  be  so  arranged.  I  am  free  to  say,  however,  that  I  think 


AMERICAN     MINING     CONGRESS  19 

California  has  been  and  is  as  fully  behind  the  Congress  as  any  of  tho 
states.  I  do  not  mean  by  that  that  California  has  done  its  full  duty  by  the 
Mining  Congress;  I  think  few  states  have  done  that.  I  trust  that  this 
meeting  may  be  one  where  there  may  be  a  large  measure  of  support 
started  for  the  Congress.  The  Congress  has  proven  its  value  by  its  work. 
If  you  will  look  back  ten  years  or  longer  and  remember  what  the  Con- 
gress was  then  I  think  you  will  find  that  the  tone  today  is  better,  the 
interest  greater  and  the  influence  of  the  Congress  has  been  very  much  in- 
creased. I  think,  therefore,  we  may  reasonably  look  forward  to  a  greater 
field  of  usefulness.  The  usefulness  must  come  from  individual  effort 
combined  into  a  united  effort.  That  can  only  come  through  proper  sup- 
port by  the  different  states.  I  trust  that  this  meeting  will  result  in  a 
more  adequate  support  from  this  time  forward,  and  that  California  will 
not  be  second  to  any  of  the  states  in  contributing  to  that  added  support 
to  which  the  Congress  is  entitled.  (Applause.) 

PRESIDENT  SCHOLZ:  It  will  be  my  pleasure  to  call  upon  Mr. 
Brunton,  the  son  of  a  former  president  of  the  Congress,  to  reply  on  be- 
half of  the  state  of  Colorado. 

MR.  FRED  K.  BRUNTON,  of  Colorado:  Mr.  President  and  fellow 
members  of  the  American  Mining  Congress:  I  did  not  come  prepared  for 
any  speech,  and  I  cannot  say  much,  because  this  is  my  first  attendance 
at  a  meeting  of  the  American  Mining  Congress.  I  would  like  to  thank 
the  people  and  citizens  of  Phoenix  and  Arizona  for  the  hospitality  and 
the  hearty  welcome  they  have  shown  us  and  leave  the  floor  to  some  of 
the  older  members  who  may  have  more  to  say  about  it.  (Applause.) 

THE  PRESIDENT:  Accepting  Mr.  Brunton's  suggestion  that  we  call 
upon  one  of  the  older  members,  I  am  going  to  call  upon  Mr.  Harry  Day, 
who  has  been  very  active  in  the  Mining  Congress  for  many  years,  to  reply 
on  behalf  of  the  state  of  Idaho. 

MR.  DAY,  of  Idaho:  Mr.  President,  ladies  and  gentlemen:  In  rising 
to  respond  on  behalf  of  the  state  of  Idaho,  I  feel  very  much  in  the  same 
situation  as  my  friend  from  California.  We  have  people  in  Idaho  who 
can  make  a  speech.  A  good  many  of  them  are  in  politics;  some  of  them 
are  in  the  mining  business;  but,  unfortunately,  none  of  them  are  here 
today.  I  simply  want  to  express  on  behalf  of  Idaho  our  deep  appreciation 
of  the  cordial  welcome  and  most  generous  hospitality  which  have  been 
tendered  us  on  all  sides.  I  am  sure  we  will  have  a  pleasant  and  very 
profitable  session  of  the  Mining  Congress.  (Applause.) 

THE  PRESIDENT :  Mr.  Charles  W.  Burgess  is  going  to  represent  the 
state  where  they  say,  "You  have  got  to  show  us,"  namely,  the  state  of 
Missouri. 

MR.  BURGESS,  of  Missouri:  Mr.  President  and  members  of  the 
American  Mining  Congress:  We  seem  to  be  all  in  the  same  boat.  This  is 
my  first  notice  that  I  represented  Missouri  and  would  be  expected  to  re- 
spond on  behalf  of  that  state.  I  am  sure  that  other  delegates  from  Mis- 
souri will  arrive  later.  But  we  do  accept  with  fullest  appreciation  the 
most  hearty  welcome  and  generous  hospitality  that  have  been  extended 
to  us  here.  We  know  what  the  American  Mining  Congress  has  done  in 
our  district.  I  remember  a  few  years  ago  we  thought  they  were  "kickin' 
our  dog  aroun',''  but  our  dog  in  this  case  happens  to  be  a  yellow  dog.  His 
name  is  Jack.  We  thought  we  were  not  given  a  square  deal  and  wished 
to  have  legislation  along  the  tariff  line.  We  lacked  the  necessary  organ- 
ization, we  were  not  equipped  for  anything  of  that  sort,  but  we  found  in 
the  American  Mining  Congress  the  agency  through  which  we  could  pre- 
sent our  case.  I  just  give  that  as  a  typical  example  of  some  of  the  needs 
that  the  American  Mining  Congress  supplies  in  case  of  necessary  action 
in  the  mining  business,  and  it  is  constantly  extending  its  influence  and  be- 


20  OFFICIAL     PROCEEDINGS 

coming  a  more  powerful  agency  for  the  promotion  of  the  mining  industry 
along  legitimate  lines. 

I  thank  you  for  the  opportunity  of  saying  a  woM  on  behalf  of  Mis- 
souri. (Applause.) 

THE  PRESIDENT:  I  am  going  to  call  on  Mr.  R.  C.  Allen,  state  geol- 
ogist, of  Michigan,  to  speak  on  behalf  of  that  state. 

MR.  ALLEN,  of  Michigan:  Mr.  President,  Gentlemen:  It  is  indeed 
an  honor  to  be  called  upon  to  speak  in  behalf  of  the  state  of  Michigan.  I 
am  advised  that  there  is  no  one  else  here  to  represent  our  state,  the  honor 
thus  falls  upon  me  by  default  and  I  am  consequently  afraid  that  Michigan 
will  not  receive  her  just  dues. 

It  is  indeed  a  pleasure  for  us  who  live  East  of  the  Rocky  mountains 
to  get  this  far  West,  and  I  wish  that  I  had  words  to  express  adequately 
our  appreciation  of  the  hospitality  of  the  people  of  Phoenix  and  Arizona. 
I  have  been  among  you  only  twenty-four  hours.  I  came  here  a  total 
stranger,  but  I  adopted  one  of  your  good  western  customs  and  began  get- 
ting acquainted  by  talking  to  the  first  men  whom  I  met.  Yesterday  as 
I  wandered  about  your  city  here  and  there  I  discovered  that  every  man 
whom  I  met  and  accosted  was  a  genial,  whole-souled,  good  fellow  and 
moreover  was  perfectly  willing  to  talk  about  Phoenix.  (Applause.) 

We  have  in  Michigan  a  lot  of  boosters  for  our  state.  We  have  a 
Northern  Peninsula  Development  Bureau,  a  Western  Michigan  Develop- 
ment Bureau,  and  an  Eastern  Michigan  Development  Bureau,  and  we  have 
an  official  at  the  State  Capitol  who  is  an  expert  professional  booster  for 
the  whole  state,  but  with  all  this  fine  equipment  we  must  confess  that 
we  are  merely  amateur  boosters  compared  with  the  people  of  Arizona. 
Many  of  our  people  find  their  way  out  into  the  West  and  after  a  few  of 
these  trips  those  of  us  who  come  back  find  that  our  "boosting"  hearts  are 
fainter,  for  the  lure  of  the  West  is  upon  us.  We  believe  that  the  West 
is  a  good  place  to  come  to  and  when  we  depart  we  always  wish  to  come 
back  for  another  visit  even  if  not  for  permanent  residence. 

I  am  sorry  that  more  Michigan  men  are  not  here.  Michigan  ought  to 
be  more  strongly  represented  for  Michigan,  as  you  know,  was  the  first 
state  in  the  Union  to  introduce  the  mining  of  copper  and  iron  ore  on  a 
large  scale  and  we  are  still  mining  both,  on  a  larger  scale  than  ever  be- 
fore. I  think  that  one  of  the  reasons  for  our  small  representation  refers 
to  the  fact  that  the  problems  which  confront  the  mining  men  of  the  West 
are  in  large  degree  those  that  we  in  the  Lake  Superior  region  do  not  have 
to  contend  with.  We  have  no  government  mineral  lands  and  very  little 
government  land  of  any  description,  therefore  the  national  policies  of  con- 
servation sit  very  lightly  on  us,  in  fact  they  hardly  touch  us.  But  we  who 
are  close  to  the  mining  industry  and  the  men  who  are  in  the  mining  in- 
dustry are  of  one  and  the  same  fraternity,  and  we  extend  to  you  men  of 
the  West  a  word  of  sympathy  in  your  endeavor  to  secure  some  govern- 
mental relief  in  certain  directions  from  the  difficulties  under  which  you 
are  laboring. 

And  now  on  behalf  of  the  Governor  of  Michigan,  the  mining  men  of 
Michigan,  and  the  people  of  Michigan,  permit  me  to  say  again  that  we  ap- 
preciate most  thoroughly  these  cordial,  kind-hearted,  genial  words  of  wel- 
come from  the  people  of  Phoenix  and  of  Arizona.  (Applause.) 

THE  PRESIDENT :  Mr.  L.  A.  Friedman  is  going  to  tell  us  something 
about  the  great  mining  state  of  Nevada. 

MR.  FRIEDMAN,  of  Nevada:  Mr.  President  and  fellow  members  of 
the  American  Mining  Congress:  This  is  rather  an  unexpected  pleasure, 
as,  while  I  have  been  a  member  of  the  American  Mining  Congress  for  a 
number  of  years,  I  am  not  here  representing  any  organization,  nor  am  I 
here  as  a  delegate.  I  just  happen  to  be  here.  Being  largely  interested  in 


AMERICAN     MINING     CONGRESS  21 

Nevada,  in  the  development  of  mines  and  the  production  of  gold,  of  which 
the  whole  world  at  this  time  seems  to  need  so  much,  I  thought  I  would 
come  and  attend  this  convention.  For  this  I  had  two  reasons :  in  the  first 
place  I  thought  I  might  learn  something;  my  second  reason  was  that  I 
thought  that  in  the  years  of  experience  I  have  had  in  mining  if  I  have 
gained  any  knowledge  that  might  be  of  any  benefit  to  the  mining  indus- 
try, if  I  could  do  anything  or  make  any  suggestion  that  might  be  of  any 
benefit  to  the  industry,  I  would  be  here  and  willing  to  do  so,  and  since  I 
have  come  here  I  have  met  so  many  intelligent  and  sincere  men  that  I 
am  truly  glad  I  am  here.  I  have  not  been  delegated  here,  consequently  I 
am  not  in  position  to  speak  for  the  state  of  Nevada,  although  I  wish  to 
state  this — that  you  can  all  bet  your  lives  that  the  state  of  Nevada  and 
its  mines  are  all  right. 

I  thank  you.     (Applause.) 

THE  PRESIDENT:  The  sister  state  of  New  Mexico,  which  I  think 
came  into  the  Union  at  the  same  time  as  Arizona,  will  be  represented  by 
Mr.  W.  A.  Fleming  Jones,  speaking  for  the  state  of  New  Mexico. 

MR.  JONES,  of  New  Mexico:  Mr.  President  and  delegates  to  the 
seventeenth  annual  session  of  the  American  Mining  Congress:  In  com- 
mon with  the  gentlemen  who  have  preceded  me,  I  can  only  say  that  noth- 
ing was  further  from  my  thoughts  than  being  asked  to  respond  to  the 
addresses  of  welcome  on  behalf  of  the  state  of  New  Mexico  this  after- 
noon; but  since  I  have  been  called  upon  I  will  try  to  say  a  few  words 
which  will  give  you  an  idea  of  our  appreciation  of  the  sentiments  that 
have  been  expressed  by  the  gentlemen  who  have  welcomed  us.  These 
words  of  welcome  are  the  more  acceptable  to  us  when  I  recall,  that  some 
eight  years  ago,  through  the  efforts  of  a  particularly  zealous  delegate  in 
the  Congress  of  the  United  States,  an  act  known  as  the  joint  statehood 
bill  was  passed  by  which  we  were  authorized  to  come  into  the  Union  as 
one  state.  We  voted  on  the  proposition,  and  New  Mexico  was  strongly 
for  it  while  Arizona  did  not  care  to  be  wedded  to  us  in  just  that  way;  in 
fact  some  of  your  citizens  were  unkind  enough  to  say  that  they  didn't 
see  how  they  could  take  a  good  egg  and  a  bad  egg  and  make  a  good  ome- 
lette. Now,  I  do  not  know  whether  they  referred  to  us  as  the  good  egg 
or  the  bad  egg.  However,  that  is  all  past  and  gone,  and  I  hope  there  is  no 
feeling  on  the  subject  now.  At  the  time  of  the  celebration  that  was  held 
in  El  Paso  in  1911  after  the  final  passage  of  the  statehood  bill  it  was  my 
privilege  to  meet  Governor  Sloan  of  Arizona  and  other  gentlemen  from 
this  state,  and  I  am  quite  sure  that  all  feeling  over  the  joint  statehood 
proposition  is  entirely  a  thing  of  the  past.  Our  interests  are  almost  the 
same  as  yours.  We  have  great  undeveloped  resources,  and  I  am  sure  that 
we  can  and  will  co-operate  with  a  view  to  their  development.  I  am  not 
here  as  a  representative  of  the  state  of  New  Mexico,  but  of  the  town  of 
Las  Cruces,  in  the  southern  part  of  the  state,  but  I  think  I  can  say  in  be- 
half of  the  people  of  the  state  and  of  my  town  that  we  deeply  appreciate 
the  sentiments  that  have  been  expressed.  I  thank  you.  (Applause.) 

THE  PRESIDENT:  It  is  a  far  jump  from  New  Mexico  to  Ohio,  but 
Mr.  C.  D.  Jury  will  tell  us  how  he  got  here  and  what  he  has  found  and 
how  well  he  likes  Phoenix. 

MR.  JURY,  of  Ohio:  Mr.  President  and  gentlemen  of  the  Congress: 
It  would  be  a  long  story  for  me  to  tell  you  how  I  got  here,  but  it  is  a 
pleasure  to  tell  you  what  I  have  found  in  the  few  hours  I  have  been  in 
Phoenix.  It  could  be  summed  up  in  one  word — "Welcome."  I  had  not 
expected  to  be  called  upon  to  respond  for  the  great  state  of  Ohio,  but 
Ohio  sends  you  greetings,  and  Ohio  is  with  the  American  Mining  Congress. 
We  know  that  it  can  do  a  good  work,  and  my  only  regret  is  that  our  state 
is  not  better  represented  here.  On  behalf  of  the  mining  interests  of  Ohio 


22  OFFICIAL     PROCEEDINGS 

I  want  to  assure  you  that  the  work  of  the  Miring  Congress  is  greatly  ap- 
preciated by  us.     (Applause.) 

THE  PRESIDENT:  Next  to  Arizona  in  age  of  statehood  is  the  state 
of  Oklahoma,  quite  a  young  baby,  some  seven  years  old,  and  I  am  going 
to  call  on  Mr.  D.  C.  McAlpine  to  tell  us  something  about  Oklahoma. 

MR.  McALPINE,  of  Oklahoma:  Mr.  President,  on  behalf  of  our  state 
I  would  say  that  Oklahoma  is  progressive  and  desires  to  assist  in  every 
movement  that  is  for  the  benefit  of  mining  in  general,  and  of  course  that 
includes  the  work  of  this  Congress.  In  the  work  of  the  Bureau  of  Mines, 
which  is  a  product  of  the  American  Mining  Congress,  the  state  of  Okla- 
homa and  the  mining  men  of  that  state  are  assisting  in  every  way  possi- 
ble to  bring  about  better  and  safer  conditions  of  mining  as  well  as  the 
conservation  of  oui<  resources,  and  we  are  glad  to  be  represented  in  this 
Mining  Congress  here  in  Phoenix.  (Applause.) 

THE  PRESIDENT:  The  last  session  of  the  Congress  was  held  in  the 
great  state  of  Pennsylvania,  and  we  have  with  us  a  gentleman  from  the 
city  of  Philadelphia,  Mr.  William  B.  Rudderow,  who  will  tell  us  some- 
thing about  Pennsylvania  and  his  home  city. 

MR.  RUDDEROW,  of  Pennsylvania:  Mr.  President,  I  want  to  say 
that  I  am  a  young  member  of  the  Congress.  I  have  a  great  deal  to  learn 
and  not  very  much  to  say.  I  have  not  been  in  the  mining  business,  and 
therefore  I  am  not  in  position  to  make  any  remarks  on  that  subject  that 
will  be  of  interest  to  you.  I  thank  you,  however,  for  the  invitation  to 
speak  in  behalf  of  my  city  and  state,  and  desire  to  express  my  apprecia- 
tion of  the  cordial  welcome  and  splendid  hospitality  extended  to  us  by 
the  people  of  Phoenix  and  Arizona.  (Applause.) 

THE  PRESIDENT:  One  of  the  first  presidents  of  the  American  Min- 
ing Congress  that  I  knew  well  was  Mr.  John  Dern,  who  is  also  well  known 
to  you,  and  I  was  very  sorry  to  learn  that  he  could  not  come  here  today, 
but  I  was  pleased  to  meet  a  chip  of  the  old  block  this  morning  in  the 
person  of  his  son,  Mr.  George  H.  Dern,  of  Utah,  who  will  tell  us  something 
about  his  state. 

MR.  DERN,  of  Utah:  Mr.  President  and  gentlemen  of  the  American 
Mining  Congress:  Utah  people  have  the  highest  regard  for  their  next 
door  neighbors  of  Arizona,  and  are  always  glad  to  visit  them.  Possibly  I 
should  use  the  word  "always"  with  some  reservation,  for  I  remember  that 
I  was  up  here  in  the  little  mining  camp  of  Chloride  one  day  in  July,  when 
It  was  118  degrees  in  the  shade,  and  very  little  shade,  so  I  felt  that  I  had 
had  a  warm  reception.  But  I  have  also  been  down  here  in  the  winter 
season,  and  I  know  that  the  Arizona  winter  climate  is  the  finest  on  earth, 
Toarring  none.  But  anyway,  we  don't  hold  the  Arizona  people  responsible 
for  the  kind  of  weather  they  have  down  here,  hence  we  are  happy  to  meet 
with  them  at  any  time,  and  on  behalf  of  the  Utah  delegation  I  want  to 
thank  them  for  their  friendly  welcome,  and  express  our  appreciation  of 
their  bounteous  hospitality. 

Speaking  of  hospitality,  I  have  heard  that  in  South  American  coun- 
tries if  you  express  admiration  for  your  host's  horse,  or  watch,  or  any 
other  possession,  he  at  once  offers  to  make  you  a  present  of  it.  Now, 
we  in  Utah  have  a  very  ardent  admiration  for  a  certain  strip  of  land 
lying  betwen  our  southern  boundary  and  the  Colorado  River.  If  I  am  not 
mistaken,  we  have  occasionally  given  audible  expression  of  this  admira- 
tion within  the  hearing  of  Arizona,  but  the  1914  maps  show  that  this 
strip  is  still  a  portion  of  the  state  of  Arizona.  Of  course,  it  is  not  for 
us  to  find  fault  with  our  neighbor  for  not  having  adopted  the  South  Amer- 
ican standard  of  hospitality.  If  she  had,  we  should  be  under  the  painful 
necessity  of  becoming  equally  polite,  and  declining  the  proffered  gift 
with  thanks,  and  then  we  would  be  right  where  we  are  now.  But  I  think 


AMERICAN     MINING     CONGRESS  23 

Utah  long  ago  learned  to  keep  the  commandment,  "Thou  shalt  not  covet 
thy  neighbor's  Arizona  strip."  And  so  we  are  the  best  of  friends,  not- 
withstanding the  fact  that  we  are  such  near  neighbors,  which  I  have  ob- 
served is  not  always  conducive  to  close  friendship.  But  all  these  moun- 
tain states  are  coming  more  and  more  to  realize  that  state  boundaries  are 
artificial  boundaries,  that  their  interests  and  their  problems  are  identical, 
and  that  they  ought  to  join  forces  and  work  togther. 

I  have  often  heard  of  the  wonderful  Hassayampa  River,  of  whose 
limpid  waters  every  loyal  son  of  Arizona  takes  a  drink,  and  thenceforth 
never  again  speaks  the  truth.  If  we  had  a  Hassayampa  River  in  Utah 
there  might  be  some  advantage  in  coming  so  late  on  the  program  of  these 
responses,  because  one  would  know  by  that  time  how  hard  to  boost  in 
order  to  make  one's  own  state  look  more  important  than  all  the  rest  as  a 
mineral  producer.  However,  not  having  the  benefit  of  the  magic  waters. 
I  must  confine  myself  to  the  literal  truth.  With  becoming  modesty,  I 
shall  neither  attempt  to  catalog  Utah's  mineral  resources  in  detail,  nor 
give  you  any  of  that  keen  delight  which  conves  from  listening  to  a  lot 
of  statistics. 

So  I  will  put  it  mildly  and  say  that  Utah  has  gold  enough  to  pave 
the  streets  of  the  New  Jerusalem.  She  has  silver  enough  to  put  an  appro- 
priate lining  on  every  cloud,  be  it  political,  industrial,  financial  or  other- 
wise. She  has  copper  enough  to  make  all  her  rival  states  turn  green  with 
envy.  Perhaps  that  is  putting  it  pretty  strong  when  we  go  up  against 
Arizona,  but  then,  copper  is  a  white  elephant  just  now  anyway,  and  the 
people  who  have  copper  are  to  be  pitied  rather  than  envied,  so  we  will 
let  that  pass. 

Utah  has  so  much  lead  that  its  very  weight  keeps  her  from  rising  to 
an  eminence  beyond  the  view  of  ordinary  states.  She  has  a  whole  county 
full  of  iron,  that  has  not  been  touched,  and  that  will  some  time  make 
her  the  Pennsylvania  of  the  West.  She  has  coal  galore;  and  I  want  to 
tell  you  right  now  that  nobody  need  worry  about  this  old  world  running 
short  of  fuel,  so  long  as  Utah  is  on  the  map;  and  we  have  no  immediate 
intention  of  getting  off  the  map.  Our  hydro-carbon  deposits  are  stu- 
pendous, and  are  growing  into  a  very  important  industry.  These  and 
countless  other  resources  have  scarcely  been  scratched,  and  we  there- 
fore feel  that  we  are  not  over-sanguine  when  we  expect  some  day  to  be 
the  very  first  state  in  mineral  production,  instead  of  the  second,  third  or 
fourth,  or  wherever  we  are  placed  now. 

In  ore-dressing  and  metallurgy,  Utah  is  second  to  none,  either  in 
magnitude  of  operations  or  in  advanced  methods.  The  immense  concen- 
trating mills  of  the  Utah  Copper  Company,  at  Garfield,  treating  20,000 
tons  of  copper  ore  per  day,  are  among  the  modern  wonders  of  the  world. 
The  smelters  at  Murray,  Midvale,  Garfield  and  Tooele  are  among  the 
largest  and  most  up-to-date  that  have  ever  been  built.  The  cyanide  pro- 
cess, which  has  revolutionized  gold  mining,  had  its  first  successful  Ameri- 
can application  in  Utah.  Vacuum  slime  filtration,  which  subsequently 
revolutionized  the  cyanide  process,  and  vastly  broadened  its  scope,  was 
invented  in  Utah.  And  now  we  are  coming  along  with  a  new  method  of 
chloridizing  roasting,  by  means  of  which  siliceous  gold,  silver  and  copper 
ores  are  treated  with  remarkable  cheapness.  This  promises  to  rank  as 
another  great  metallurgical  achievement. 

In  short,  Utah  mines  have  contributed  liberally  to  the  world's  wealth, 
and  Utah  men  have  contributed  liberally  to  mining  science  and  to  the 
store  of  human  knowledge.  I  thank  you.  (Applause.) 

THE  PRESIDENT:  All  the  wealth  of  our  mines  would  not  avail  us 
very  much  if  we  had  not  somebody  to  buy  our  products,  and  I  am  going  to 
call  on  Mr.  H.  C.  Holthoff  of  Milwaukee  to  tell  us  what  the  great  state  of 
Wisconsin  thinks  about  the  mining  business. 


24  OFFICIAL    PROCEEDINGS 

i 

MR.  HOLTHOFF,  of  Wisconsin:  Mr.  President  and  members  of  the 
American  Mining  Congress:  I  did  not  come  prepared  to  make  a  speech. 
About  all  I  can  say  is  that  the  state  of  Wisconsin  appreciates  the  hearty 
welcome  we  have  received  at  the  hands  of  the  state  of  Arizona  and  the 
city  of  Phoenix,  and  to  express  the  hope  that  the  session  of  this  Congress 
may  result  in  material  benefit  to  the  mining  industry.  (Applause.) 

THE  PRESIDENT:  When  we  speak  or  think  of  Texas  we  have  in 
mind  a  long-horned  Texas  steer  or  the  large  grain  and  cotton  fields  of 
that  state.  But  Texas  is  also  a  great  mineral  state,  as  many  of  us  know, 
and  Dr.  Wm.  B.  Phillips  can  tell  more  about  it  than  all  of  us  put  together, 
because  he  is  making  a  study  of  it  and  I  am  going  to  call  on  him  to  tell 
us  what  his  discoveries  are. 

MR.  PHILLIPS,  of  Texas:  Mr.  President  and  Members  of  the  Ameri- 
can Mining  Congress:  I  am  always  prepared  to  make  a  speech.  I  am 
very  much  obliged  for  the  opportunity.  (Laughter.)  But  I  feel  so  in 
the  dark.  This  is  the  first  time  I  have  ever  had  the  pleasure  of  ad- 
dressing an  audience  composed  largely  of  ladies  and  being  unable  to 
say  "My  fellow  citizens." 

I  am  reminded  of  a  famous  speech  that  was  delivered  in  the  city  of 
Louisville,  Kentucky,  some  years  ago.  At  a  great  banquet  there  a  silver- 
tongued  speaker  was  asked  to  respond  to  a  toast  to  Woman,  and  every- 
body expected  a  magnificent  speech,  because  he  was  a  splendid  orator. 
He  rose  and  waited  until  there  was  complete  silence,  and  raised  his  glass 
and  said,  "Here  is  to  woman,  may  God  bless  her.  Formerly  our  superior, 
now  our  equal."  (Laughter.) 

I  wish  to  express,  on  behalf  of  Texas,  our  appreciation  of  your  most 
cordial  welcome  and  generous  hospitality  on  this  occasion.  I  cannot 
come  West,  into  this  part  of  the  country,  without  feeling  the  greatest 
obligation  to  Arizona  and  Phoenix  for  the  affectionate  and  whole-souled 
character  of  their  hospitality.  Together,  I  think  Arizona  and  Texas  could 
rule  the  world.  You  have  enough  gold  and  silver  in  Arizona  to  pay  off 
the  national  debt;  we  have  enough  iron  to  run  the  furnaces  of  the  world 
for  a  thousand  years;  you  have  enough  copper  to  copperplate  the  sun, 
moon  and  stars  and  all  the  other  flag  stations  of  the  Universe.  (Laugh- 
ter.) We  have  enough  coal  to  melt  all  the  Antarctic  ice,  and  we  have 
enough  oil  to  lubricate  the  wheels  of  time  and  to  grease  the  mills  of 
the  gods  that  are  said  to  grind  so  slowly;  we  have  enough  natural  gas 
in  that  state — and  some  out  of  it  just  now — to  melt  the  whole  world  and 
leave  of  it  only  a  pile  of  sinter  surmounted  by  a  salamander  solemnly 
waving  its  tail  and  calling  for  enchiladas  and  tobasco  sauce. 

When  one  gets  to  speaking  about  Texas  he  speaks  for  three  weeks. 
I  have  never  seen  a  man  from  that  state,  even  if  he  had  only  passed 
through  the  state,  who  had  any  sense  of  time  whatever  when  he  began 
to  speak  about  Texas.  But  I  will  not  tire  your  patience.  I  would,  how- 
ever, invite  you  to  come  over  into  the  state  of  Texas  at  any  time;  and, 
speaking  of  latch-strings,  we  haven't  any.  We  took  the  door  down  long 
ago  and  threw  it  away. 

Some  time  ago  there  was  a  killing  in  our  state — a  very  rare  occur- 
rence (Laughter) — and  when  we  are  so  fortunate  as  to  have  the  same 
law  in  Texas  as  you  have  in  Arizona  of  course  there  will  not  be  any 
killings  at  all.  The  man  charged  with  the  murder  consulted  his  attorney 
and  wanted  to  know  what  on  earth  he  should  do.  "Well,"  he  said,  "you 
haven't  any  case  at  all.  You  had  better  get  out  of  here."  "Well,"  said 
the  client,  "I  would  like  to  know  where  I  am  going.  Ain't  I  in  Texas 
now?"  (Laughter.)  He  came  to  Arizona,  and  would  have  been  here 
now  but  for  the  fact  that  the  rumor  of  prohibition  reached  him  in  time 
and  he  went  back  home.  (Laughter  and  applause.) 


AMERICAN     MINING     CONGRESS  25 

THE  PRESIDENT:  Very  few  of  us  know  that  Florida  does  anything 
else  but  grow  grape  fruit  and  oranges,  but  it  has  some  phosphate  mines, 
and  therefore  is  a  mining  state.  Florida  is  ably  represented  here  by  Mr. 
F.  E.  Marriner,  who  will  respond  on  behalf  of  that  state.  (No  response.) 

Is  there  any  other  state  represented  here  which  has  not  been  called 
upon.  If  so,  will  the  gentleman  please  rise  and  be  heard  from?  (No 
response.) 

There  doesn't  seem  to  be.  I  have  called  on  thirteen  states.  Thirteen 
is  my  lucky  number,  and  I  hope  that  it  may  be  an  omen  of  the  success 
of  this  meeting. 

I  want  to  make  one  announcement  before  we  proceed,  namely,  that 
the  meeting  at  the  Woman's  Club  that  was  called  for  7:30  has  been  post- 
poned to  8:30,  I  presume  to  afford  additional  time  for  primping,  so  don't 
be  one  hour  too  soon. 

MR.  JOHN  W.  FOSS,  of  California:  Mr.  President,  I  move  that  a 
committee  be  appointed  to  formulate  a  response  to  the  letter  from  the 
President  of  the  United  States. 

(Motion  seconded  and  carried  unanimously.) 

THE  PRESIDENT:    I  will  appoint  the  committee  later. 

SECRETARY  CALLBREATH:  The  committee  on  resolutions  is 
made  up  of  one  member  from  each  of  the  states  represented  in  the  con- 
vention, chosen  by  the  members  of  the  delegation  present.  This  plan  is 
followed  so  that  the  control  of  the  resolutions  committee  may  be  entirely 
removed  from  the  management  of  the  Mining  Congress,  in  order  that  the 
resolutions  may  thoroughly  and  fairly  represent  the  sentiment  of  the 
delegates.  Will  you  kindly,  therefore,  assemble  your  state  delegations 
sometime  this  afternoon  or  evening,  or  at  least  before  the  opening  session 
tomorrow  morning,  so  that  at  the  opening  of  the  meeting  tomorrow  morn- 
ing as  the  states  are  called  you  may  make  response  nominating  the  per- 
son whom  you  expect  to  serve  upon  the  committee  on  resolutions. 

I  might  say  that  heretofore  the  responses  to  the  addresses  of  welcome 
by  the  various  states  have  taken  so  much  time  when  notice  was  given 
to  those  who  were  to  be  asked  to  speak  that  it  was  thought  better  this 
time  not  to  give  notice. 

THE  PRESIDENT:  On  the  committee  suggested  by  Dr.  Foss  I  will 
appoint  Dr.  John  W.  Foss,  Mr.  Geo.  H.  Dern  and  Mr.  J.  F.  Callbreath  to 
draft  a  letter  to  President  Wilson  in  reply  to  his  communication  read  here 
this  afternoon.  Is  there  any  other  matter  to  come  before  the  Congress 
now?  If  not,  we  will  take  an  adjournment. 

The  following  telegram  was   sent  to  President  Wilson: 

The  President,  the  White  House,  Washington,  D.  C.: 

Sir — The  American  Mining  Congress,  in  Seventeenth  Annual  Session 
assembled  at  Phoenix,  Arizona,  gratefully  acknowledges  your  kind  letter 
of  greeting  and  encouragement.  We  especially  appreciate  your  deep  in- 
terest in  the  movement  to  reduce  the  hazards  and  the  waste  in  the  mining 
and  mineral  industries  of  this  country;  and  the  members  of  the  Mining 
Congress  pledge  you  their  hearty  co-operation  in  carrying  forward  the 
great  movement  looking  to  the  accomplishment  of  these  purposes. 

We  respectfully  ask  your  further  aid  in  securing  the  enactment  of 
such  much  needed  legislation  as  will  make  effective  the  yet  unfulfilled 
pledges  of  the  majority  party  given  in  its  last  national  platform  and 
often  repeated,  looking  to  a  proper  enlargement  of  the  now  inadequate 
work  of  the  national  government  for  increasing  safety  and  efficiency 
and  for  the  general  advancement  of  mining  as  one  of  the  nation's  two 
great  foundation  industries. 

CARL   SCHOLZ,   President. 

December  7,  1914.  J.   F.   CALLBREATH,   Secretary. 

Meeting  adjourned. 


2S  OFFICIAL     PROCEEDINGS 

EVENING    SESSION. 
(At  the  Woman's  Club  Building.) 

8:30  p.  m. — Meeting  called  to  order  by  Mr.  Power  Conway.  President 
Carl  Scholz  was  presented  and  delivered  the  President's  Annual  Address, 
which  will  be  found  at  page  129  of  this  report.  After  the  address  the  ladies 
of  Phoenix  tendered  a  delightful  reception  to  the  officers  and  delegates. 

TUESDAY,  DECEMBER  8,  1914. 
Morning  Session,  9:30  O'clock  A.  M. 

THE  PRESIDENT:  The  first  thing  in  order  is  the  reading  of  the  list 
of  members  of  the  Resolution  Committee,  and  the  secretary  will  call  the 
roll  of  members  of  the  different  states,  which  will  respond  by  giving  the 
names  of  their  respective  members  of  that  committee. 

The  Committee  on   Resolutions. 

Arizona   Norman  Carmichael 

California    Seeley  W.  Mudd 

Colorado   W.  G.  Swart 

Florida  F.  E.  Marriner 

Idaho   Harry  L.  Day 

Michigan   R.  C.  Allen 

Missouri   Charles  W.  Burgess 

Mississippi   F.  G.  Jewett 

Montana    D.  McKenzie 

New  Mexico  Rees  H.  Beddow 

New  York  J.  R.  Burton 

Nevada  L.  A.  Friedman 

New  Hampshire   C.  M.  Donohoe 

Oklahoma   D.  C.  McAlpine 

Pennsylvania   W.  V.  Rudderow 

Texas  S.  H.  Worrell 

Utah  Imer  Pett 

Wisconsin   H.  C.  Holthoff 

THE  PRESIDENT:  The  report  of  the  committee  on  Taxation  of 
Metalliferous  Mines  will  be  presented  by  Mr.  D.  L.  Webb  of  Denver, 
chairman  of  the  committee. 

MR.  WILL  L.  CLARK,  of  Arizona:  Mr.  President,  so  far  as  I  know, 
I  am  the  only  member  of  the  committee  present.  Mr.  Webb  has  asked  me 
to  present  the  report,  and  I  have  a  word  of  explanation  to  make.  As  is 
common  in  these  Mining  Congress  committees,  unless  the  committee  is 
continued  for  several  years  and  it  has  an  opportunity  to  meet  at  the 
convention,  a  new  committee  like  this  usually  does  not  have  any  meeting 
at  all.  I  have  had  some  correspondence  with  Mr.  Webb,  who  has  taken 
the  suggestions  made  by  the  members  of  the  committee  and  endeavored 
to  embody  them  in  the  report.  For  that  reason  this  report  is  not  alto 
gether  satisfactory  either  to  Mr.  Webb  or  to  myself,  but  in  order  to  bring 
up  the  discussion  we  thought  best  to  present  it.  Yesterday  afternoon  I 
was  given  the  proof  of  the  report.  As  it  is  quite  long  I  will  not  attempt 
to  read  it  at  this  time,  because  it  has  been  printed.  I  will  send  up  the 
report.  I  suppose  after  any  discussion  that  may  come  up  it  will  then 
be  proper  to  determine  what  shall  be  done  in  regard  to  its  adoption,  so 
I  will  not  now  make  any  motion  to  that  effect,  but  if  desired,  it  may  be 
referred  to  the  Committee  on  Resolutions. 

SECRETARY  CALLBREATH:  Some  members  of  the  convention  do 
not  seem  to  have  copies  of  the  report.  There  are  plenty  of  them  ready 
for  distribution  in  the  rear  of  the  hall. 


AMERICAN     MINING     CONGRESS  27 

THE  PRESIDENT:  Mr.  Thomas  E.  Campbell  will  lead  the  discussion 
on  this  paper  under  the  five-minute  rule. 

SECRETARY  CALLBREATH:  Before  proceeding,  may  I  suggest 
that  that  five-minute  rule  be  disregarded  in  this  instance?  I  do  not  think 
that  it  is  possible  for  any  one  to  discuss  a  question  so  large  as  the  ques- 
tion of  taxation  in  five  minutes,  and  I  would  suggest  that  a  more  extended 
time  be  allowed. 

MR.  BERN:  If  the  members  are  expecting  to  discuss  this  paper  it 
seems  to  me  it  would  be  a  good  idea  to  have  it  read  so  that  we  may  have 
some  knowledge  of  the  subject  before  the  discussion  begins.  A  printed 
copy  has  just  been  handed  to  us  and  nobody  has  had  a  chance  to  read  it. 

THE  PRESIDENT:  The  purpose  of  distributing  the  copies  in  ad- 
vance was  to  give  a  chance  for  everybody  to  inform  himself;  but  if  it 
is  deemed  desirable  to  do  so  it  will  be  read. 

SECRETARY  CALLBREATH:  The  report  was  agreed  upon  so  late 
that  this  is  the  earliest  possible  moment  we  could  have  it  printed. 

A  DELEGATE:    Mr.  President,  I  move  that  the  report  be  read. 

(Motion  seconded  and  carried  unanimously.) 

(The  report  was  thereupon  read  by  the  secretary,  and  is  as  follows:) 

Report  of  Committee  on  Mine  Taxation. 

Denver.  Colorado,  Dec.  7th,  1914. 
Mr.  Chairman  and  Members  of  The  American  Mining  Congress: 

Gentlemen:  The  Committee  on  Mine  Taxation  of  the  National  Tax 
Association,  in  reporting  to  the  Association's  meeting,  held  at  Buffalo  in 
October,  1913,  said: 

"The  subject  submitted  to  the  committee  is  an  exceedingly  complex 
one,  and  on  many  of  the  phases  the  committee  feels  the  need  of  longer 
time  for  study  and  investigation.  For  that  purpose  it  is  recommended 
that  the  committee  be  continued." 

It  appears  that  the  action  heretofore  taken  by  the  American  Mining 
Congress  as  such,  and  by  its  individual  members  in  their  respective  local- 
ities, has  begun  to  bear  fruit;  and  has  resulted,  at  least,  in  persuading 
the  members  of  the  National  Tax  Association,  as  well  as  the  various  as- 
sessors and  tax  commissioners  who  are  members  thereof,  that  the  taxa- 
tion of  mines  is  a  subject  worthy  of  careful  consideration,  having  its  own 
peculiarities,  requiring  special  treatment  and  of  sufficient  importance  to 
justify  a  standing  committee. 

It  is  the  belief  of  this  committee  that  mining  claims,  for  taxation 
purposes,  may  always  be  safely  divided  into  two  distinct  classes,  i.  e.,  non- 
producing  mining  claims  and  producing  mining  claims. 

Non-Producing  Claims. 

No  matter  for  what  reason  a  mining  claim  may  be  non-productive,  it 
should  be  classed  as  a  non-producing  mining  claim,  and  no  value  at- 
tached for  taxation  purposes,  by  reason  of  the  existence  of  known  mineral 
contents,  unless  that  mineral  is  being  actually  marketed  at  a  profit. 

The  Legislatures  of  different  states  have  shown  surprising  variations 
when  guessing  (it  can  be  termed  nothing  else)  at  the  value  of  non-pro- 
ducing mining  claims  for  taxation  purposes;  for  instance,  in  Montana 
non-producing  mining  claims  are  assessed  at  a  value  of  $5  per  acre,  while 
in  Nevada  they  are  assessed  at  $50  per  acre,  and  in  another  state,  under 
the  tax  law,  it  is  provided  that  the  non-producing  claims,  when  owned  by 


28  OFFICIAL     PROCEEDINGS 

a  corporation,  may  be  assessed  at  a  value  represented  by  the  capital  stock 
of  the  corporation. 

One  of  the  members  of  this  committee,  in  a  paper  submitted  at  the 
last  convention  of  The  American  Mining  Congress,  suggested  that  the 
proper  criterion  for  the  assessment  of  non-producing  mining  claims  was 
the  price  at  which  the  Federal  Government  sold  the  ground  to  the  pat- 
entee, to-wit:  $5  per  acre;  and  submitted  the  query  that  if  this  was  not 
proper,  in  fact  the  only,  criterion  of  the  value  of  such  ground,  then  what 
was?  This  committee  has  neither  seen  nor  heard  a  direct  answer  to  this 
query;  but  the  committee  of  the  National  Tax  Association,  above  referred 
to,  did  say: 

"The  mineral  content  and  value  of  unexplored  and  undeveloped  ore 
bodies,  patented  mines  and  mining  claims,  is  frequently  so  uncertain  that 
for  this  class  of  property  there  is  ample  justification  for  conservative 
treatment,  and  even  for  postponing  the  full  possible  claim  of  the  state 
until  actual  knowledge  of  the  situation  can  be  obtained." 

Along  this  same  thought  the  committee  notes  an  expression  in  the 
report  of  the  Wisconsin  Tax  Commission  for  1910,  where  it  is  stated: 

"It  would  be  more  logical  and  tend  to  better  administration  if  the 
lands  (non-producing  mining  claims)  were  assessed  without  regard  to  the 
minerals." 

This  committee  appreciates  that  non-producing  mining  claims  ought 
to  be  assessed  and  a  reasonable  tax  collected  therefrom;  but  since  no 
man  can  tell  whether  a  non-producing  mining  claim  is  of  any  value,  until 
actual  operation  begins,  it  submits  that  the  only  fair  and  reasonable  rule 
is  as  follows: 

"Non-producing  mining  claims  should  not  be  assessed  upon  a  value 
higher  than  adjacent  land,  not  assessed  for  mining  purposes,  is  as- 
sessed." 

Producing  Mining  Claims. 

It  is  safe  to  say  that  the  producing  mining  claims  will  pay  the  great 
bulk  of  the  mining  taxes  in  any  state,  wherefore  this  committee  has  de- 
voted more  attention  to  the  question  of  the  proper  basis  of  taxation  of 
producing  than  of  non-producing  mining  claims.  There  appears  to  be  two 
well  denned  theories  for  the  taxation  of  producing  mining  claims.  One, 
an  ad  valorem  tax,  and  the  other  an  income  tax. 

This  committee  is  firmly  of  the  opinion  that  a  tax  upon  the  net  in- 
come of  producing  claims,  is  the  only  method  which  is  fair  to  the  state, 
in  the  first  place,  to  the  mining  industry,  in  the  second  place,  and  be- 
tween the  various  producing  claims  of  a  state  or  district,  in  the  third 
place. 

The  vices  of  the  ad  valorem  system  of  taxation  of  mining  claims  be- 
come apparent  upon  a  superficial  study  of  the  subject,  and  become  ex- 
pensive and  disagreeable  realities  wherever  and  whenever  the  system 
is  in  vogue. 

The  State  of  Michigan,  when  putting  a  system  of  taxation  of  mines  on 
an  ad  valorem  basis  into  operation,  went  so  far  as  to  employ  a  very  com- 
petent engineer  to  make  an  appraisal  of  the  value  of  the  mines  and  min- 
eral lands  within  each  taxing  district.  This  was  an  attempt  by  that  state, 
of  course,  to  operate  the  ad  valorem  system  upon  as  fair  a  basis  as  was 
possible  to  the  state  and  the  mining  industry.  The  value  of  the  mines 
to  be  taxed  upon  that  system  was  calculated  upon  the  following  main 
factors : 

A. — Ore  reserves.  B. — Average  annual  production.  C. — Cost  of  pro- 
duction. D. — Average  price  to  be  obtained  for  product.  E. — Average  an- 
nual profit,  and,  F. — Rate  of  interest  or  value  of  money. 


AMERICAN     MINING     CONGRESS  29 

It  would  seem,  at  first  blush,  that  the  factors  taken  into  considera- 
tion ought  to  result  in  a  proper  valuation  of  the  mines  for  taxation  pur- 
poses; but  that  such  uncertainties  as  would  render  the  system  impracti- 
cable for  taxation  purposes  were  bound  to  obtain  have  been  very  closely 
demonstrated  in  a  recent  scholarly  article  by  Mr.  Heath  Steele,  of  New 
York,  who  says: 

"No  one  can  dispute  that  a  stated  annual  income  for  a  certain  num- 
ber of  years  has  a  present  value  easily  determined  at  a  fixed  rate  of  in- 
terest. If  this  were  all  for  a  correct  appraisal,  I  should  not  question  the 
fairness  of  this  system  of  taxing.  But  as  my  idea  of  the  principle  in- 
volved requires  a  system  which  takes  from  each  in  the  same  proportion, 
there  must  be  no  liability  of  error  in  the  method  of  assessment.  Working 
from  this  point  of  view,  let  us  take  up  each  main  factor  as  previously 
stated. 

"A — To  arrive  at  the  amount  of  ore  to  be  considered  in  an  ap- 
praisal of  this  kind  we  must  not  only  consider  fully  developed  ore  but 
all  indications  for  further  extensions  of  ore  bodies  beyond  mine  openings. 
Here  we  run  into  difficulties  much  greater  than  are  encountered  in  meas- 
uring developed  ore.  The  developed  ore  factor  is  more  or  less  approxi- 
mate, but  estimates  of  further  extensions  are  bound  to  vary  greatly  from 
fact.  However,  these  are  not  the  only  obstacles  in  the  way  of  a  correct 
statement  of  ore  reserves.  The  average  content  of  valuable  minerals  is 
a  very  difficult  factor  to  determine  correctly  for  a  large  ore  reserve  and 
is  in  most  cases  a  guess,  regardless  of  elaborate  sampling  and  inferences 
that  may  be  drawn  as  to  the  uniform  contents  within  certain  blocks. 
The  best  we  can  do  is  to  concede  that  the  ore  reserve  factor  is  an  esti- 
mate consisting  of  two  basic  factors,  both  of  which  may  be  wrong. 

"B — The  factor  of  average  annual  production  not  only  serves  to  de- 
termine the  length  of  life  but  the  average  annual  profit.  If  the  rate  of 
production  is  greater  than  estimated  the  profit  will  be  more  or  vice 
versa.  B.  is  dependent  upon  A.  and  is  subject  to  the  errors  of  A. 

"C — The  cost  of  production  may  be  closely  estimated.  I  say  esti- 
mated because  no  matter  how  much  of  a  record  one  may  have  to  judge 
from,  future  expectations  in  connection  with  costs  are  no  more  infallable 
than  the  assumption  of  the  ore  reserve  factor.  This  is  particularly  true 
where  metals  of  changing  value  are  involved,  for,  granting  the  cost  per 
ton  of  ore  is  the  minimum,  a  lowering  of  the  grade  of  metal  content  will 
increase  the  cost  of  the  metal. 

"D — The  factor  of  average  price  to  be  obtained  for  the  product  is 
a  presumption  and  nothing  else.  One  man's  judgment  may  be  better 
than  another's  because  he  has  studied  the  supply  and  demand  and  is 
conversant  with  all  market  governing  factors,  but  we  cannot  grant  him 
the  powers  of  a  true  prophet. 

"E — This  factor,  the  average  annual  profit  excepted,  is  the  sum  of 
all  the  errors  of  A.,  B.,  C.  and  D.,,  all  of  which  will  reflect  in  the  profit. 
If  the  average  price  to  be  received  for  the  product  is  a  correct  assump- 
tion, so  far  as  it  relates  to  the  average  price  for  the  whole  period,  the 
average  annual  profits  may  be  the  sum  estimated.  But  the  present  value 
obtained  by  this  calculation  and  the  present  value  that  may  be  obtained 
at  the  exhaustion  of  the  mine  with  the  actual  annual  earnings  as  a  basis 
will  hardly  be  the  same.  This  is  particularly  true  with  the  metals  that 
fluctuate  widely  in  price.  If,  during  the  first  half  of  the  operating  period, 
the  price  of  metal  should  be  lower  than  the  average  used,  the  actual 
present  value  of  the  property  will  be  less  than  estimated.  If  higher 
prices  are  secured  the  value  will  be  raised.  A  fair  check  will  only  be 
made  when  a  practically  uniform  price  prevails  or  the  highest  prices  are 
received  during  the  middle  of  the  period. 


30  OFFICIAL     PROCEEDINGS 

"F — The  rate  of  interest  is  a  factor  that  may  be  adjusted  to  suit  the 
individual  in  private  work.  For  taxation  purposes  the  worth  of  money 
is  a  debatable  question,  but  a  rate  should  be  used  that  will  represent  the 
actual  earning^  power  of  the  money  without  special  effort.  If  the  busi- 
ness is  hazardous,  all  factors  of  safety  will  properly  have  been  provided 
in  the  basic  factors. 

"Here  it  is  shown  that  the  only  calculation  involved  in  mine  ap- 
praisal for  which  we  can  absolutely  vouch  as  being  correct  is  the  de- 
ferring of  the  expected  annual  income  at  a  fixed  rate  of  interest.  We 
may  have  errors  in  each  of  the  five  main  factors  together  with  those 
in  the  basic  factors  of  which  they  are  composed.  I  do  not  think  that  the 
most  ardent  advocate  of  mine  taxation  on  a  valuation  basis  will,  if  he  con- 
siders the  presumptive  character  of  the  data  necessarily  involved,  con- 
tend that  an  equitable  distribution  of  tax  burdens  can  be  accomplished 
by  this  method.  It  is  impossible  to  value  any  mine  correctly  until  it  has 
been  worked  out,  therefore,  if  we  attempt  to  value  a  number  of  mines 
in  a  taxing  district  some  will  surely  be  assessed  too  high  and  some  too 
low." 

It  is  because  of  those  things  pointed  out  by  Mr.  Steele  that  such 
great  students  of  taxation  as  Professor  Skelton  of  Queen's  University, 
Kingston,  Ontario,  has  said: 

"The  positive  reason  for  preferring  the  tax  on  the  output  is  its 
greater  certainty.  Any  estimate  of  the  value  of  the  minerals  in  the 
ground  must,  it  is  felt,  contain  a  large  element  of  guess  work — diligent 
and  scientific  guess  work  it  may  be,  but  guess  work  still." 

and  Professor  Edward  A.  Seligman,  McVickar  Professor  of  Political 
Economy  of  Columbia  University  and  President  of  the  National  Tax  As- 
sociation 1913-14,  said: 

"The  difference  between  the  earnings  system'  and  the  ad  valorem 
system  is  the  difference  between  publicity  and  secrecy,  between  certainty 
and  arbitrariness,  between  simplicity  and  complexity,  between  precision 
and  guess-work — in  short,  between  modernism  and  medievalism. 

"If,  then,  the  earnings  tax  is  to  be  preferred  to  the  ad  valorem  tax, 
the  question  remains,  Shall  it  be  gross  earnings  or  net  earnings?  As  a 
matter  of  principle  it  is  conceded  by  all  writers  that  net  earnings  ap- 
proach more  closely  to  the  ideal  method." 

If,  then,  an  ad  valorem  system  of  taxation  of  producing  mines  is 
wrong — and  the  experience  of  mining  men,  tax  experts  and  college  pro- 
fessors who  have  made  it  a  special  study,  to  say  nothing  of  the  practical 
demonstration  of  it  when  in  operation,  all  show  it  to  be  wrong — then 
there  remains  but  one  other  method  for  the  taxation  of  producing  mining 
claims,  to-wit,  a  tax  upon  income. 

The  first  question  to  be  determined  upon  a  tax  upon  income  is 
whether  the  whole  or  any  portion  of  the  gross  production  should  be  in- 
cluded in  the  valuation  of  the  mine  for  taxation  purposes. 

There  is  no  question  in  the  minds  of  this  committee  that  no  portion 
of  the  gross  should  be  included;  and  the  point  may  be  illustrated  by  the 
existing  conditions  in  Colorado  and  Arizona;  such  being,  we  believe,  fair 
examples  of  the  results  obtained  and  to  obtain  wherever  the  gross  pro- 
ceeds are  considered  in  valuing  a  mine  for  taxation  purposes. 

The  Colorado  law  provides  that  one-half  of  the  gross  plus  all  of  the 
net  shall  be  the  value  of  the  producing  mine  for  taxation  purposes.  A 
couple  of  very  extreme  examples  will  illustrate  the  possibilities  of  this 
law  in  its  operation,  as  between  producing  mines  under  differing  condi- 
tions; for  instance: 


AMERICAN     MINING     CONGRESS  31 

First  Extreme:  Mine  A.  B.  produced  $100,000  gross  in  given  year; 
its  entire  expense  was  $1,000;  its  net  therefore  is  $99,000.  Its  tax  value 
therefore  would  be  calculated  thus: 

1/2   Gross    $  50,000 

All  net 99,000 


Tax  value   $149,000    rate  3% — $4,470.    approx.  4%%  of  net. 

Seond  Extreme:  Mine  C.  D.  produced  $100,000  gross  in  a  given  year; 
its  entire  expense  was  $99,000;  its  net  therefore  is  $1,000;  its  tax  value 
therefore  would  be  calculated  thus: 

%   Gross    $  50,000 

All    net    1,000 


Tax  value   $51,000     rate  3 %— $1,530.     153%  of  net. 

Of  course  no  mine  producing  $100,000  gross  per  year  is  going  to  have 
either  $1,000  or  $99,000  net,  but  some  figure  between  these  extremes; 
however,  it  is  a  simple  calculation  to  demonstrate  what  two  mines  pro- 
ducing $100,000  gross  per  annum,  one  with  a  net  of  $50,000  and  the 
other  with  a  net  of  $25,000,  will  have  a  differential  running  against  the 
mine  with  $25,000  net  (on  a  3%  rate)  of  approximately  50%. 

In  fact,  in  a  recent  case  decided  by  the  District  Court  of  Teller 
County,  Colorado,  the  actual  disparagement  existing  between  two  well 
known  mines,  are  shown  in  the  words  of  the  court,  as  follows: 

"By  way  of  illustrating  the  inequality  resulting  in  this  case,  I  call 
attention  to  the  following: 

"It  is  shown  by  the  evidence  that  the  Cresson  Company's  gross  pro- 
ceeds for  the  year  1913  were  $537,603.58;  its  net  proceeds  $373,140; 
assessment  under  the  Act  1913,  one-half  gross  proceeds  plus  net,  $641,- 
941.79.  The  Portland  Company's  gross  proceeds  for  the  year  1913  were 
$862,642.34.  Its  net  proceeds,  $315,160;  assessment  under  the  Act  1913, 
one-half  gross  proceeds  plus  net,  $746,481.17.  It  will  be  noted  that  the 
gross  proceeds  of  the  Portland  exceeds  those  of  the  Cresson  Company 
by  over  $325,000;  that  the  net  proceeds  of  the  Cresson  Company  ex- 
ceeded those  of  the  Portland  by  nearly  $58,000,  while  the  Portland  was 
assessed  under  the  Act  of  1913  on  over  $104,000  more  than  the  Cresson. 
Such  gross  inequality  as  the  above  cannot  be  avoided  if  the  Act  of  1913 
is  to  be  upheld  as  a  valid  exercise  of  the  legislative  power.  It  is  mani- 
festly arbitrary  and  unjust,  and  lacking  in  the  uniformity  required  by  the 
constitution." 

The  same  results  in  a  lesser  degree  must  obtain  in  Arizona,  where 
the  law  provides  for  the  valuation  of  a  producing  claim  for  taxation  pur- 
poses upon  a  basis  of  12%%  of  the  gross  plus  four  times  the  net,  using 
the  same  extreme  examples  that  were  used  to  illustrate  the  Colorado 
situation,  it  will  be  found  that  the  mine  with  $99,000  net  will  pay  a  tax 
equivalent  to  12%%  of  its  net;  and  a  mine  with  $1,000  net  will  pay  a 
tax  equivalent  to  50%  of  its  net;  and  in  the  examples  illustrating  the 
Colorado  difference  between  the  mines  with  a  net  of  $50,000  and  $25,000 
there  will  be  a  differential  against  the  mine  with  a  $25,000  net  of  ap- 
proximately 8%%.  The  reason,  of  course,  that  there  is  not  such  a 
difference  between  the  $50,000  net  and  the  $25,000  net  mines  in  Arizona, 
as  there  is  in  Colorado,  is  because  in  Arizona  only  12%%  of  the  gross 
is  used  for  valuation  purposes.  That  the  Colorado  law  works  out  as 
illustrated  in  the  above  examples  and  in  the  Cresson-Portland  case,  is 
verified  by  the  fact  that  in  the  year  1913  the  gross  production  of  the 
Colorado  metal  mines  was  $35,450,585  (U.  S.  Geol.  Sur.,  1913,  p.  227). 
While  metalliferous  mining  properties  were  assessed  for  the  same  year 
$46,042,047  (Colo.  Tax.  Com.  Rept,  1913,  p.  129).  Thus  it  will  be  seen 


32  OFFICIAL     PROCEEDINGS 

that  the  metalliferous  mines  of  Colorado  paid  taxes  on  approximately 
$10,600,000  more  than  they  made  in  the  year  1913. 

Not  only  do  states,  which  provide  for  the  assessment  of  all  or  a 
portion  of  the  gross  and  all  or  more  of  the  net,  offend  man's  natural 
sense  of  right  and  justice,  but  they  likewise  offend  two  fundamental 
principles  of  law  concerning  taxation  which  have  been  written  into  most 
if  not  all  of  the!  constitutions  of  the  various  states  of  the  Union.  These 
constitutional  provisions  vary  in  their  terms,  but  the  sense  of  them  is 
the  same  and  the  following  excerpts  from  a  state  constitution  will  serve 
to  illustrate  the  principle  that  is  written  into  most  of  them. 

(a)  "All  taxes  shall  be  uniform   upon  the  same  class  of  subjects 
within  the  territorial  limits  of  the  authority  levying  the  taxes. 

(b)  "All  taxes  shall   be  levied   and   collected   under   general    laws 
which  shall  prescribe  such  regulations  as  shall  secure  a  just  valuation 
for  taxation." 

The  lack  of  uniformity  required  by  such  constitutional  provisions, 
the  gross  inequality  inhibited,  and  the  absurdity  of  such  a  system  of 
taxation  are  all  at  once  manifest  from  the  above  examples. 

Everyone  knows  that  uniformity  in  taxation  implies  equality  in  the 
burden  of  taxation,  and  that  all  taxes  must  be  uniform  on  the  same 
class  of  property  within  the  jurisdiction  of  the  authority  levying  and 
collecting  taxes  and  that  this  uniformity  must  be  such  as  to  result  in 
equality  of  the  burden. 

There  can  be  no  claim  of  uniformity  or  equality  where  a  profitable 
mine  pays  taxes  at  the  rate  of  4*£%  of  its  net,  and  an  unprofitable  mine 
pays  taxes  at  the  rate  of  153%  of  its  net. 

Not  only  this,  but  it  will  be  readily  seen  that  a  system  which  taxes 
both  gross  and  net  must  of  necessity  result  in  a  double  taxation.  For 
instance,  where  the  taxing  scheme  is  to  tax  one-half  the  gross,  plus  all 
of  the  net,  then  one-half  of  the  net  is  twice  taxed,  i.  e.,  first,  when  it  is 
taxed  as  net,  and  second,  when  it  is  taxed  as  a  portion  of  the  gross. 

The  same  Committee  of  the  National  Tax  Association  in  thei  report 
say: 

"We  are  opposed  for  the  class  of  mines  now  under  consideration  to 
the  so-called  gross  and  net  methods  of  taxation.  Gross  income  bears 
no  uniform  relation  either  to  net  income  or  to  value.  A  mine  with  a 
gross  income  in  any  year5  of  $100,000  may  have  lost  money  and  have  no 
more  ore  to  mine,  or  it  may  have  made  $50,000  and  have  thirty  such 
years  to  look  forward  to  in  the  future,  or  it  may  have  made  $10,000  net 
and  have  five  years  of  similar  business  to  look  forward  to  in  the  future. 
With  mines  of  very  short  life  the  gross  income  method  tends  to  make 
the  tax  excessive.  With  mines  of  long  life  and  relatively  low  cost  of 
production,  the  method  tends  to  yield  an  insufficient  tax.  As  between 
mines,  it  is  almost  always  unjust  and  unequal." 

CONCLUSIONS. 

If  this  committee  is  right  in  its  conclusions  that  an  ad  valorem 
system  of  taxation  is  not  applicable  to  the  mining  industry  from  any 
angle;  and  that  an  income  tax,  which  includes  any  portion  of  the  gross, 
is  wrong  for  the  reason  assigned;  then  it  remains  only  to  determine 
what  is  a  proper  system  of  taxation  on  the  net  alone. 

Upon  this  question  men  may  conscientiously  differ  a  great  deal. 
This  committee  feels,  however,  that  a  few  salient  principles  for  such 
taxation  will  be  accepted  as  fair  to  all  concerned,  i.  e. : 

(a)  That  a  uniform  system  for  determining  what  is  meant  by  the 
term  "net  proceeds"  should  be  adopted  by  the  law  making  power. 


AMERICAN     MINING     CONGRESS  33 

This  is  a  principle  which,  following  the  Interstate  Commerce  Com- 
mission, has  been  written  into  the  laws  of  many  of  our  states  that  have 
provided  Public  Utility  Commissions.  These  commissions  are  required 
to  adopt  uniform  systems  of  accounting,  so  that  the  amount  earned  by 
each  public  utility  in  the  state  may  be  shown.  There  seems  no  good 
reason  why  a  uniform  system  of  accounting  cannot  be  prescribed  for  the 
various  mines  of  a  state. 

(b)  That  if  a  tax  upon  the  net  proceeds  only  of  mines  of  a  state 
would  be  insufficient  to  produce  the  revenue  necessary  for  the  state's 
purposes,  or  to  produce  that  necessary  revenue  would  run  the  rate  of 
taxation  inordinately  high,  then  a  fair  system  of  capitalizing  the  net 
proceeds  at  a  figure  which,  at  the  prevailing  rate  of  taxation  would  pro- 
duce the  required  revenue,  would  be  a  proper  system. 

Respectfully  submitted, 

D.  L.  WEBB,  Chairman, 

L.   A.    YOUNG, 

H.   A.   E.    CHANDLER, 

JOHN    WELLINGTON    FINCH, 

WILL    L.    CLARK, 

Committee. 

THE  PRESIDENT:  I  am  very  glad  this  paper  was  read,  because  I 
think  we  have  all  gotten  a  clearer  idea  than  we  would  have  had  without 
reading  it,  and  we  are  now  going  to  discuss  it,  and  I  am  going  to  ask 
Mr.  Campbell,  who  is  a  member  of  the  new  State  Tax  Commission,  to 
come  upon  the  platform  to  lead  this  discussion. 

MR.  CAMPBELL,  of  Arizona:  Mr.  President  and  Gentlemen  of  the 
American  Mining  Congress:  I  feel  highly  complimented  by  being  called 
upon  to  lead  this  discussion,  and  in  fact  until  yesterday  about  noon 
time  I  did  not  know  that  the  honor  was  to  be  conferred  upon  me.  The 
result  is  that  I  have  made  absolutely  no  preparation.  It  is  a  question 
upon  which  so  many  mine  owners  and  mining  organizations  and  tax 
official  differ  that  I  think  the  discussion  should  be,  as  -much  as  possible, 
informal.  Now,  as  has  been  well  said  by  our  good  Secretary,  you  cannot 
get  very  far  into  the  discussion  of  taxation  in  five  minutes,  and  in  fact 
we  have  discussed  matters  of  much  minor  importance  and  it  has  taken 
us  a  week  and  then  we  didn't  get  anywhere.  The  result  will  be  that  in 
the  few  minutes  allotted  to  me  on  this  question  I  am  going  to  confine 
myself  to  the  particular  phases  and  principles  of  taxation  which  are 
represented  by  the  report  before  us  at  this  time.  There  are  just  twc 
problems  confronting  us,  namely,  whether  the  mine  shall  be  assessed 
on  the  ad  valorem  system  or  the  old  general  property  tax  system,  or  upon 
the  so-called  net  production  system.  The  argument  as  presented  by  the 
report  which  has  been  read  is,  I  think,  very  worthy  so  far  as  it  treats 
of  the  assessment  upon  the  gross  or  net  profit,  but  when  it  refers  to  the 
question  of  the  ad  valorem  tax,  particularly  with  reference  to  the  Michi- 
gan system,  I  feel  that  it  does  not  go  sufficiently  into  the  fundamental 
principles  of  ad  valorem  taxation.  I  feel,  likewise,  that  it  does  not  go 
sufficiently  into  the  application  of  that  tax  as  it  is  applied  in  Michigan, 
so  that  you  do  not  by  the  report  get  exactly  the  true  conditions.  The 
question  of  taxation  upon  net  results  is,  of  course,  absolutely  that  of 
an  income  tax.  Now,  very  few  states  in  the  Union  which  apply  taxes 
of  this  kind  are  in  a  position  to  apply  any  income  tax.  Arizona — and  I 
speak  of  local  conditions  because  I  am  more  familiar  with  them — is 
blessed  in  the  fact  that  it  can  apply  any  sort  of  a  tax  that  can  get  the 
money;  in  fact  that  has  been  our  past  experience;  so  that  it  could  apply 
here.  However,  in  treating  the  question  as  to  the  relative  merits  of 
these  two  systems  I  am  quite  as  much  at  sea  as  many  of  you  are,  not- 
withstanding I  have  given  this  question  considerable  thought  and  study 


34  OFFICIAL     PROCEEDINGS 

and  have  discussed  it  with  a  great  many  men  from  all  parts  of  the  state 
and  with  economists  from  all  over  the  country.  The  reason  is  owing 
to  the  particular  class  of  property  with  which  you  are  dealing.  Another 
reason  is  comparing  its  income  or  its  revenue  produced  for  the  benefit 
of  the  state  with  other  classes  of  property,  which  fact  must  always  be 
borne  in  mind.  In  other  words,  fundamentally,  our  whole  system  of 
taxation  is  built  upon  this  plan — the  ability  of  the  taxpayer,  or  the 
property,  if  you  please,  to  pay  its  proportion  of  the  burden  of  taxation, 
and  that  is  fundamental  in  the  application  of  the  general  property  tax 
as  it  is  fundamental  in  the  application  of  all  classes  of  taxation  under 
our  form  of  government.  There  are  so  many  questions  radiating  from 
the  different  points  of  view  as  to  the  application  of  this  tax  that  it  is  not 
altogether  just  a  concrete  case.  You  might  say  we  apply  this  argument 
to  this  particular  class,  but  we  will  not  make  it  local,  but  in  the  last 
analysis  it  absolutely  is  local,  my  friends,  and  you  all  know  that,  so 
that  I  am  not  prepared  to  say  at  this  time  that  I  favor  the  ad  valorem 
system  of  taxation  or  the  application  of  the  net  income  system  of  taxation 
by  special  legislation.  I  have  very  decided  views  upon  that  question 
which  would  embody  the  use  of  both  or  all  factors  entering  into  the 
appraising  of  this  or  any  other  class  of  property. 

Now  you  know  that  I  was  quite  right  when  I  said  I  had  made  no 
preparation  on  this  subject  at  all.  I  think  probably  I  was  called  upon 
at  so  late  an  hour  in  order  to  throw  a  sort  of  bomb  into  the  proposition, 
and  if  I  have  succeeded  in  that  I  feel  that  I  have  done  well.  As  a  mem- 
ber-elect of  the  Tax  Commission  you  will  also  appreciate  the  position 
I  occupy  here  in  Arizona,  not  at  this  date  having  qualified  in  office,  and 
that  I  am  in  no  position  to  speak  for  the  commission  upon  this  question, 
which,  no  doubt,  in  its  recommendations  to  the  coming  Legislature,  so 
far  as  Arizona  is  concerned,  will  have  considerable  weight.  Being  more 
or  less  of  a  quasi-judicial  member  of  that  commission,  I  am  hardly  in  a 
position  to  state,  and  in  fact  it  would  be  indelicate  for  me  to  state,  that 
I  believed  as  a  commissioner  that  this  or  that  tax  is  correct,  so  that  you 
will  pardon  my  embarrassment  at  this  particular  time. 

I  do  not  know  that  I  can  say  any  more  on  the  question  at  all  that 
will  be  of  interest  to  you.  I  hope,  however,  Mr.  President,  that  I  may 
have  the  privilege  later  on  in  this  discussion  of  asking  questions  for 
the  purpose  of  getting  light  upon  this  subject,  because  it  is  the  biggest 
question  that  we  tax  men  have  to  deal  with  in  Arizona. 

I  thank  you,  Mr.  President,  and  I  thank  you  gentlemen  of  the  Con- 
gress for  calling  upon  me  to  lead  in  this  discussion. 

THE  PRESIDENT:  We  would  like  to  hear  from  other  members 
on  this  subject  of  such  great  interest  to  all  of  us. 

MR.  HULL:  Mr.  President,  in  regard  to  the  assessment  of  mining 
property,  we  find  that  other  people  who  have  property  have  to  be  as- 
sessed upon  it,  and  I  think  that  we  should  establish  a  uniform  price 
for  the  land.  I  believe  there  should  be  a  valuation  put  upon  it.  When 
it  comes  to  the  mining  industry  and  the  production  of  minerals  the 
assessment  of  the  mines  should  be  upon  the  net  proceeds  of  the  mines. 
My  idea  is  that  there  should  be  a  value  placed  upon  all  lands  that  are 
patented.  I  believe  that  if  we  undertake  to  levy  taxes  and  assess  only 
upon  the  net  proceeds  of  the  mine  the  people  around  the  country  would 
object  to  that  and  would  down  this  institution.  Let  us  get  the  people  in 
line  and  work  for  these  things  and  make  a  reasonable  assessment  on 
the  land,  because  the  farmer  has  to  do  the  same.  We  have  to  work  to- 
gether, and  the  farmers  have  got  to  work  with  us  instead  of  trying 
to  down  the  mining  industry.  They  are  the  ones  that  depend  upon  us; 
they  depend  upon  what  we  are  doing;  they  receive  the  benefit,  and 
every  man  in  the  United  States  receives  the  benefit  from  the  remunera- 


AMERICAN     MINING     CONGRESS  35 

tion  that  comes  from  these  mines,  even  if  there  is  no  profit  to  the  man 
that  is  producing  and  working  upon  them.     (Applause.) 

THE  PRESIDENT:  Death  and  taxes  are  two  things  that  none  of 
us  can  escape,  so  that  we  ought  to  have  a  very  full  discussion  of  this 
subject. 

MR.  CAMPBELL:  Mr.  President,  I  do  not  want  to  be  presumptions, 
but  inasmuch  as  there  are  two  schools  of  thought  on  this  matter,  and 
inasmuch  as  the  committee  has  recommended  the  net  income  tax  and 
has  made  reference  to  the  Michigan  system,  which  is  the  pioneer  in  the 
use  of  the  ad  valorem  system,  and  inasmuch  as  we  have  Mr.  Allen,  their 
mine  appraiser,  with  us,  I  know  we  would  all  very  much  enjoy  hearing 
from  him  upon  this  question.  (Applause.) 

THE  PRESIDENT:  Mr.  Allen  is  going  to  favor  us  with  a  discussion 
of  this  matter.  Will  you  please  come  forward  to  the  platform,  Mr. 
Allen? 

MR.  R.  C.  ALLEN,  Lansing,  Michigan:  With  your  permission,  Mr. 
President,  I  would  prefer  to  speak  from  the  floor.  Being  misled  by  your 
sunny  and  semi-tropical  climate,  and  induced  by  the  attractions  of  your 
beautiful  valley,  I  went  out  last  evening  for  a  walk  without  an  overcoat. 
When  I  arose  this  morning  I  found  that  I  had  lost  the  use  of  my  neck 
and  a  part  of  one  arm.  Before  I  get  through  with  this  discussion  per- 
haps some  of  you  will  regret  that  I  did  not  also  lose  the  use  of  my 
voice. 

Before  beginning  this  discussion  I  want  to  say  most  emphatically 
that  I  am  not  an  expert  in  matters  of  taxation,  neither  am  I  an  econo- 
mist. However,  for  the  past  three  or  four  years  it  has  been  my  good 
fortune,  or  misfortune,  as  the  case  may  be,  to  have  had  a  part  in  the 
administration  of  the  Michigan  ad  valorem  system  of  mine  taxation. 
After  reading  the  report  of  this  Committee,  I  have  become  somewhat 
alarmed,  for  I  had  never  before  fully  appreciated  the  precarious  position 
that  I  seem  to  occupy.  In  Michigan  the  general  property  tax  extends 
to  mines,  and  we  are  required  to  assess  mines  on  the  full  ad  valorem 
value,  which  is  defined  in  law  as  the  exchange  value  or  sale  value.  In 
the  capacity  of  appraiser  of  mines  I  am  required,  under  penalty  of  six 
months  in  jail,  to  appraise  these  mines  at  not  more  nor  less  than  what 
they  are  worth!  (Laughter.)  I  am  now  informed  by  this  Committee 
that  it  is  impossible  to  do  any  such  thing,  so  I  hope  you  will  appreciate 
my  anxiety  to  learn  something  about  this  question  of  how  mines  may 
be  taxed  or  rather  how  they  may  be  appraised  on  the  ad  valorem  basis. 

Gentlemen,  it  seems  to  me  that  we  will  never  make  very  much 
progress  toward  a  permanent  solution  of  these  questions  of  mine  tax- 
ation until  there  has  been  brought  about  a  better  understanding  between 
mining  and  other  classes  of  people  in  regard  to  methods  of  assessing 
mining  property  for  taxation.  You  may  be  interested  in  a  little  bit  of  our 
domestic  history.  The  state  of  Michigan  is  a  mining  state.  I  think 
that  the  value  of  our  production  exceeds  that  of  Arizona.  We  have 
about  two  hundred  million  dollars'  worth  of  mining  property,  that  is  to 
say,  in  deference  to  this  report  of  the  Committee,  we  think  we  have,  and 
that  is  what  we  appraise  them  at.  For  a  great  many  years  the  subject 
of  mine  taxation  has  agitated  the  people  of  Michigan.  There  is  now  and 
always  has  been  in  Michigan,  as  in  this  and  other  states,  a  large  class 
of  people  who  believe  that  the  mining  interests  are  not  now  and  never 
have  been  sustaining  their  just  and  due  share  of  the  tax  burdens.  So 
far  as  Michigan  is  concerned,  that  belief  was  largely  justified  until  the 
state,  through  its  Tax  Commission,  took  charge  of  the  assessment  of 
mining  properties.  We  have  now  executed  our  fourth  re-appraisal  of  the 
iron  mines  and  it  must  be  said  that  the  work  of  the  Tax  Commission 
has  gone  a  long  way  toward  the  solution  of  the  problem  of  mine  taxation 


36  OFFICIAL    PROCEEDINGS 

in  Michigan.  It  has  also  resulted  in  a  much  better  spirit  between  the 
mining  interests  and  the  rest  of  the  people,  because  the  publicity  given 
to  the  methods  of  mine  valuation  has  amounted  to  a  campaign  of  edu- 
cation. To  the  farmer,  for  instance,  has  been  brought  some  of  the  im- 
portant facts  concerning  the  mining  industry;  these  have  carried  con- 
viction that  the  industrial  difficulties  in  the  mining  communities  are  of 
the  same  order  as  those  which  prevail  among  the  farmers;  and  with 
this  interchange  of  ideas  there  has  grown  up  something  like  an  era  of 
good  feeling. 

Now,  I  hope  that  the  American  Mining  Congress  does  not  make  any 
definite  expression  concerning  the  report  of  this  Committee.  I  believe 
the  subject  is  so  large,  that  it  has  so  many  ramifications,  that  it  is  so 
complex,  and  also  in  view  of  the  fact  that  we  will  have  only  a  few 
minutes  to-  consider  the  report,  and  the  further  fact  that  the  majority 
of  the  delegates  of  this  Congress  are  not  here,  that  it  will  not  be  wise 
for  the  few  of  us  who  are  here  to  take  any  action  in  the  matter.  It 
appears  to  me — and  we  are  talking  informally  here,  I  understand — that 
this  report  is  really  somewhat  in  the  nature  of  special  pleading.  We 
must  of  necessity  look  at  the  subject  of  mine  taxation  from  the  double 
point  of  view  of  the  mine  operator  or  owner  and  of  the  other  taxpayers ; 
we  have  got  to  consider  the  position  of  the  general  taxpayer  as  well  as 
the  position  of  the  mine  owner.  I  might  say  frankly  that  there  are  very 
few  mine  owners  or  operators  or  professional  men  connected  with  mining 
who  would  not  agree  at  once  with  this  Committee  in  their  recommenda- 
tion that  the  proper  tax  is  the  tax  upon  net  earnings  if  we  look  at  the 
problem  from  the  one  viewpoint  alone,  considering  merely  the  interests 
of  mining  investors.  But  this  organization  exists  for  the  purpose  of 
bettering  conditions  in  the  mining  industry,  and  while  we  are  trying  to 
do  that — spreading  the  Gospel  as  it  were — we  should  be  willing  also  to 
look  at  our  problems  from  the  popular  standpoint,  to  be  willing  to  co- 
operate with  the  rest  of  the  people  in  making  conditions  generally 
better.  Now  in  Michigan  we  think  that  anything  that  is  good  for  the 
mines  is  good  for  Michigan,  and  anything  that  is  good  for  Michigan 
ought  to  be  good  for  the  mining  industry.  Now  many  states,  either  from 
necessity  or  through  preference,  are  committed  to  the  general  property 
tax.  Michigan  is  one  of  them.  It  is  not  my  intention  to  discuss  the 
merits  or  demerits  of  the  general  property  tax,  but  that  we  have  it  and 
cannot  divorce  it  is  the  practical  condition  that  confronts  us.  The 
people  of  Michigan  must  be  convinced  that  mining  property  is  being 
treated  in  exactly  the  same  manner  as  all  other  property.  Neither  the 
law  nor  the  people  can  be  satisfied  with  anything  short  of  that.  A  tax 
on  production  or  a  tax  on  net  income  does  not,  in  Michigan,  seem  to 
meet  the  conditions  because  it  affords  no  means  of  tax  equalization. 

The  history  of  our  ad  valorem  tax  dates  from  the  year  1911.  We 
were  then  considering  in  the  Legislature  the  wisdom  of  enacting  a 
specific  tax  on  production — a  tonnage  tax.  The  mining  men  of  Michigan 
have  always  fought  any  kind  of  tax  based  upon  income  or  production 
and  it  has  been  as  consistently  supported  by  the  farming  element.  After 
the  matter  was  thoroughly  discussed  and  threshed  out  in  the  Legislature, 
as  a  compromise  measure  a  bill  was  passed  which  directed  and  em- 
powered the  State  Tax  Commission  to  make  an  appraisal  of  the  mines. 
In  order  that  the  whole  procedure  might  be  divorced  from  local  or 
political  influence  or  bias  it  was  deemed  advisable  to  secure  for  this 
work  an  engineer  and  assistants  who  had  no  financial  or  political  inter- 
est in  Michigan  and  consequently  would  not  be  liable  to  be  prejudiced 
in  favor  of  the  Michigan  mines. 

Inasmuch  as  the  Michigan  system  has  been  summarily  dismissed 
in  the  report  of  the  Committee  on  taxation  of  metalliferous  mines  I 
should  like  to  introduce  at  this  point  an  explanation  of  this  system  as 
applied  to  iron  mines.  It  has  not  yet  been  extended  to  Michigan  copper 


AMERICAN     MINING     CONGRESS  37 

mines  except  as  a  test  of  the  valuation  made  by  the  county  Boards  of 
Supervisors.  Such  extension  is,  however,  contemplated  by  the  Board 
of  State  Tax  Commissioners. 

The  Michigan  System  of  Iron  Mine  Appraisals. 

The  final  results  of  the  appraisal  of  iron  mines  for  the  purpose  of 
taxation  are  determined  through  the  application  of  four  distinct  pro- 
cedures. 

First.  It  is  the  duty  of  the  State  Geologist  and  his  assistant,  who  is 
a  competent  mining  engineer,  to  secure  adequate  information  on  which 
to  base  the  value  of  each  mining  property.  To  this  end  there  is  required 
to  be  made  by  each  mine  operator  an  annual  report  to  the  Board  of 
State  Tax  Commissioners,  as  of  date  December  31st  of  the  year  pre- 
ceding, comprising:  (1)  A  detailed  financial  statement,  duly  executed 
before  a  notary  public,  of  the  operations  of  each  mine  or  mining  property 
owned,  operated  or  controlled  by  him  on  forms  officially  designed  for 
the  purpose,  covering  a  period  of  the  preceding  five  years.  (2)  The 
financial  statement  is  required  to  be  supplemented  by  a  complete  set  of 
accurate  mine  maps  showing  each  mine  level,  cross  sections,  records  of 
drill  holes,  pits,  shafts,  etc.;  also  a  map  showing  the  boundaries  of 
each  property  and  the  relation  of  the  ore  bodies  to  adjacent  properties. 
All  maps,  plats,  records,  etc.,  as  are  required  are  signed,  dated  and  duly 
executed  by  the  operator  or  a  responsible  official  of  the  company,  as  the 
case  may  be,  and  form  a  part  of  the  report  of  the  operator  to  the  Board 
of  State  Tax  Commissioners. 

Second.  The  State  Geologist  and  his  assistant  make  an  annual  ex- 
amination of  the  mines  above  and  below  ground  for  the  purpose  of 
calculating  ore  reserves  and  obtaining  such  other  data  as  may  have  a 
bearing  on  values.  When  this  is  done  the  value  of  each  property  is 
calculated  by  the  appraiser  through  methods  which  will  be  explained 
later. 

Third.  After  the  appraiser  has  calculated  the  value  of  each  property 
his  findings  are  reported  to  the  Board  of  State  Tax  Commissioners  who 
consider,  with  the  appraiser,  each  of  the  several  properties  in  detail  and 
take  formal  action  on  the  figures  recommended  by  the  appraiser. 

Fourth.  The  figures  which  are  tentatively  determined  by  the  Board 
of  State  Tax  Commissioners  are  reported  to  the  operators,  who  are 
given  an  opportunity  of  appearing  before  the  Board  of  State  Tax  Com- 
missioners in  a  public  hearing  and  submitting  additional  arguments  or 
information  having  to  do  with  the  value  of  their  respective  properties. 
At  the  conclusion  of  these  hearings  the  various  properties  are  again  con- 
sidered in  detail  by  the  Board  of  State  Tax  Commissioners  when  the 
final  values  for  assessment  purposes  are  fixed  and  reported  to  the  as- 
sessors of  the  various  assessing  districts  by  whom  they  are  placed  on  the 
tax  rolls. 

Theory  and   Method  of  Appraisal   of   Iron    Mines. 

Stated  in  briefest  manner,  the  value  of  an  iron  mine  is  the  present 
worth  of  the  sum  of  money  representing  the  calculated  difference  be- 
tween total  receipts  from  sales  of  ore  and  the  cost  of  marketing  based 
on  the  entire  tonnage  which  the  mine  may  be  expected  to  produce. 
This  difference  exceeds  by  a  large  amount  the  actual  profit  to  the  oper- 
ators for  it  includes  the  items  of  royalties  and  makes  no  allowance  for 
sinking  charges  for  general  exploration  which  are  necessarily  large  and 
continuous  in  order  that  the  industry  may  be  sustained  and  perpetuated. 

We  have  now  to  consider  how  the  total  expected  profits,  thus  de- 
fined, may  be  calculated.  The  calculation  is  the  product  of  three  factors, 
viz:  (1)  Total  tonnage  of  available  ore;  (2)  average  annual  excess  per 
ton  of  receipts  over  actual  cost  of  operation;  (3)  the  present  worth  of 


38  OFFICIAL     PROCEEDINGS 

one  dollar  to  be  paid  in  equal  annual  installments  for  a  period  of  years 
equal  to  the  productive  life  of  the  mine.  The  methods  by  which  the 
numerical  value  of  these  factors  are  determined  are  as  follows: 

1.  The  factor  of  tonnage.     There  is  no  general  method  or  set  rule 
for  measuring  tonnage  which  may  be  applied  indiscriminately  to  all  iron 
mines.     It  is  necessary  to  adopt  the  method  of  calculation  to  the  indi- 
vidual property  because  of  dissimilarities  in  the  natural  or  geologic  con- 
ditions in  the  various  mines  and  districts.     The  ore  which  is  expected 
to  be  realized  is  considered  under  two  classes,  the  ore  in  sight  and  the 
prospective  ore.     In  the  undeveloped   properties  much  the  greater  part 
of  the  ore  must  be  considered  as  prospective  pending  the  development 
of  the  ore  body  by  underground  mining.     The  amount  of  developed  ore 
in  the  producing   mines  may  be  calculated  with  comparative  ease,  but 
the  amount  of  prospective  ore  must  be  determined  in  the  judgment  of 
the  appraiser  by  the  use  of  principles  of  geologic  and  mining  practice. 
In  nearly  all  of  the  mines  there  are  certainties,  probabilities  and  possi- 
bilities  for   the   occurrence   of   ore   beyond   that  which   is   actually   de- 
veloped.    As  a  matter  of  actual  practice  the  amount  of  prospective  ore 
on  which  the  mines  are  assessed  for  purposes  of  taxation  exceeds  the 
total  amount  of  developed  ore.     For  instance,  on  January  1,  1914,  there 
were  81,261,238  tons  of  developed  ore  in  the  mines,  to  which  was  added 
by  the  appraiser  116,208,087  tons  of  prospective  ore.     These  figures  do 
not  include  4,954,830  tons  in  stock  on  the  same  date  which  is  treated 
as  developed  ore  but  assessed  as  personalty  in  distinction  from  realty. 
In  estimating  total  reserves  in  a  mining  property  the  appraiser  attempts 
to  ascertain  the  total  amount  of  ore  which  may  reasonably  be  expected 
to  be  produced  from  the  property. 

2.  The  factor  of  profits.     The  term  profits  is  here  used  to  express 
the   algebraic    difference    between   receipts    and   actual    costs    as   above 
defined.     The   actual  cost   and   profit   per  ton   is   ascertained   for   each 
operating  mine  from  its  actual  operating  financial  record  over  a  period 
of  five  years  preceding.    By  the  use  of  the  five-year  period  large  fluctu- 
ations in  the  total  valuations  on  account  of  sharp  annual  variations  in 
costs  and  receipts  have  been  eliminated. 

It  is  obvious  of  course  that  an  undeveloped  property  has  no  oper- 
ating record  from  which  profits  may  be  calculated.  For  these  properties 
the  expectations  are  measured  by  the  experience  of  mines  under  oper- 
ation under  similar  conditions  in  the  district  in  which  the  undeveloped 
property  is  located. 

3.  The   life  factor  and   interest  rate.     The  product  of  total  reserve 
tonnage  by  a  demonstrated,   assumed  or  calculated  profit  per  ton,  ex- 
pected to  accrue  from  operation,  is  in  most  cases  far  in  excess  of  present 
value  because  the  rate  at  which  ore  can  be  mined  from  a  given  property 
is  limited  by  both  physical  and  market  conditions.     Only  a  fraction  of 
the  total  reserves  are  annually  marketed  and  the  income  is  therefore 
realized  in  annual  installments  over  a  period  of  years  as  the  ore  is  mined 
and  sold.     The  total  value  of  an  iron  mine  resides  in  the  ore,  and  it 
follows  that  when  the  ore  is  exhausted  all  assets  are  dissipated,  except 
of  course  the  junk  or  second-hand  value  of  the  equipment  and  the  value 
of  the  land  for  non-mining  purposes.    An  ore  body  in  process  of  mining 
is,  therefore,  a  vanishing  asset  and  the  valuation  of  an  iron  mine  in- 
volves the  determination  of  the  present  value  of  this  asset. 

The  time  or  life  factor  must  therefore  be  taken  into  account.  The 
productive  life  of  an  operating  mine  is  in  practice  calculated  as  the 
ratio  of  total  ore  reserves  to  the  average  annual  shipment  based  on  the 
experience  of  the  preceding  five  years.  The  life  factor  of  an  undeveloped 
ore  body  is  measured  in  the  same  manner  on  the  assumption  of  an  aver- 
age shipment  indicated  by  other  developed  properties  in  the  same  class, 


AMERICAN     MINING     CONGRESS  39 

with  proper  allowance  for  the  time  necessary  for  development  to  the 
producing  stage. 

After  ascertaining  the  average  annual  installment  of  profits  and 
the  number  of  such  annual  installments  which  is  represented  by  the 
number  of  years  of  productive  life,  the  total  is  reduced  to  present  worth 
by  the  annuity  method,  using  an  interest  rate  of  6%  for  both  principal 
and  sinking  fund.  In  many  cases  the  sum  thus  calculated  is  reduced  by 
a  safety  or  hazard  rate  which  varies  from  nothing  up,  according  to  the 
actual  hazards  indicated  by  the  physical  condition  of  the  property,  state 
of  development,  etc. 

The  above  methods  are  applicable  in  general  but  are  modified  by 
such  considerations  as  are  pertinent  to  certain  individual  cases.  Such 
modifications  are  applied  in  accordance  with  the  judgments  of  the  ap- 
praiser and  the  Board  of  State  Tax  Commissioners.  It  will  not  be  neces- 
sary here  to  explain  the  multiplicity  of  cases  which  demand  the  appli- 
cation of  judgment  involving  departure  from  the  general  method  set 
forth  above. 

Since  the  Finlay  appraisal  of  1911  we  have  made  three  re-appraisals 
of  iron  mines,  and  it  seems  now  that  Michigan  is  committed  to  the  ad 
valorem  system  of  mine  taxation.  There  is  a  class  of  people  in  Michigan 
known  as  the  Grange,  a  farmers'  organization,  who  are  attempting  to 
initiate  a  specific  tax  upon  the  production  of  the  mines,  but  the  members 
of  the  Grange  are  among  the  strongest  supporters  of  the  ad  valorem  tax. 
They  say,  "By  all  means  let  us  have  this  ad  valorem  tax;  it  is  a  good 
tax,  and  we  want  the  mines  to  pay  a  tax  on  their  ad  valorem  value;  but 
in  addition  to  that  we  want  them  also  to  pay  a  surtax  in  the  form  of 
a  specific  tax  on  production  at  a  rate  that  will  practically  double  their 
taxes.  In  other  words,  we  believe  that  a  mining  property  should  pay, 
in  proportion  to  its  value,  a  double  rate  of  taxation."  That  is  the  argu- 
ment back  of  their  campaign,  and  they  are  making  it  squarely  and 
openly.  That  is  the  condition  the  mines  are  facing  today  in  Michigan, 
and  perhaps  it  constitutes  one  reason  why  the  mining  men  of  Michigan 
are  solidly  back  of  the  ad  valorem  system. 

Now  the  statement  is  made  here  in  the  report  of  the  Committee  that 
the  ad  valorem  system  of  mine  taxation  in  Michigan  is  wrong  in  theory 
and  has  failed  in  practice.  I  would  like  to  ask  the  Committee  whether 
they  got  this  information  from  any  organization  of  Michigan  mining  men 
or  from  the  Michigan  State  Tax  Commission  or  from  the  Michigan 
people,  for  the  facts,  I  assure  you,  are  quite  the  contrary.  We  do  not 
believe  that  the  ad  valorem  is  a  perfect  tax,  but  it  has  more  nearly  met 
the  conditions  in  Michigan  than  any  other  tax  we  have  ever  had,  and 
we  have  had  some  experience  with  the  specific  tax. 

The  position  taken  here  (referring  to  report)  by  Mr.  Heath  Steele — • 
and  I  notice  he  is  quoted  with  approval  by  this  Committee — not  only 
magnifies  the  difficulties  in  arriving  at  an  ad  valorem  value  of  a  mine, 
but  also  his  argument  is  inconsistent  all  the  way  through.  I  wish  to 
make  a  few  remarks  on  these  various  matters  in  the  order  in  which  he 
has  taken  up  the  discussion. 

We  all  know,  of  course,  that  it  is  ordinarily  impossible  for  an  en- 
gineer or  geologist  or  anybody  else  to  closely  approximate  the  amount 
of  prospective  ore  in  a  undeveloped  mine;  but  there  is  a  lack  of  clear 
thinking  as  concerns  the  importance  of  this  consideration  in  mine  valu- 
ation for  taxation.  Is  it  a  fair  assumption  that  if  the  appraiser  fails  to 
foresee  and  to  measure  every  ton  of  ore  that  exists  within  the  boundaries 
of  a  property  he  will,  through  that  circumstance  alone,  fail  to  establish 
the  approximate  value  of  that  property  for  exchange  purposes?  Look 
at  it  in  this  way:  Here  is  the  city  of  Phoenix.  The  Salt  River  Valley 
may  be  invaded  by  locusts  at  some  future  time,  with  the  consequence 
that  all  of  the  crops  will  be  destroyed  or  damaged  for  several  successive 


40  OFFICIAL     PROCEEDINGS 

years.  Don't  you  suppose  that  such  a  catastrophe  would  affect  the  value 
of  lots  in  this  city?  But  under  Mr.  Steele's  reasoning  unless  the  ap- 
praiser of  lots  in  the  city  of  Phoenix  has  foreseen  the  arrival  of  these 
locusts  and  the  destruction  of  crops  and  has  taken  account  of  it  in  his 
estimates  of  values  he  has  failed  to  arrive  at  the  true  value  of  the  lots. 
The  experts  who  take  the  position  that  Mr.  Steele  has  taken  here  must 
thereby  abandon  at  once  their  own  professional  viewpoints.  Mines  are 
valued  for  purposes  of  sale;  they  are  valued  as  a  basis  for  expenditure 
in  plant  installation;  they  are  valued  as  a  basis  for  the  marketing  of 
stocks  and  bonds,  and  for  other  commercial  purposes.  In  fact  the  chief 
business  of  a  great  many  expert  professional  men  in  this  country  is  the 
rendering  of  these  valuations.  These  experts  will  admit  that  they  are 
quite  competent  to  go  out  and  examine  a  property,  no  matter  what  state 
of  development  it  is  in,  and  advise  the  client  as  to  its  value  for  purposes 
of  investment.  Then  why  refuse  to  recommend  such  valuation  for  pur- 
poses of  taxation?  Now,  gentlemen,  let  us  lay  hold  of  this  fact — what- 
ever a  property  is  worth  for  commercial  purposes  it  is  also  worth  for 
purposes  of  taxation.  That  is  the  underlying  principle  of  the  ad  valorem 
system  of  mine  taxation.  The  valuation  of  a  mine  for  taxation  is  merely 
the  best  possible  estimate  of  what  that  property  is  worth  in  the  market 
in  the  condition  in  which  it  is  found  on  the  day  of  the  appraisal.  If  the 
mine  turns  out  to  have  produced  ten  times  the  amount  of  ore  that  was 
estimated  to  be  there  that  is  no  proof  that  the  valuation  on  the  date  on 
which  it  was  made  was  not  correct,  because  there  was  taken  into  con- 
sideration all  of  the  elements,  all  of  the  conditions,  and  all  of  the  cir- 
cumstances of  whatsoever  character  which  then  did  affect  the  value  of 
that  property  for  exchange  purposes.  The  values  which  are  hidden  in  the 
ground,  which  are  not  known  to  be  there,  which  are  there  undiscovered, 
do  not  exist;  they  do  not  exist  until  they  are  actually  discovered,  and  of 
course  an  appraiser  is  not  expected  to  include  that  which  does  not  exist 
in  his  valuation. 

A  DELEGATE:  Do  you  take  prospective  values  into  consideration 
at  all? 

MR.  ALLEN:  We  do.  I  will  get  to  that  just  a  little  bit  later.  By  the 
way,  Mr.  President,  I  hope  you  will  ring  me  down  at  any  time. 

THE  PRESIDENT:  You  shall  have  the  floor  as  long  as  you  wish  it. 
We  are  very  much  interested  in  your  talk. 

MR.  ALLEN:    Note  this.    (Reading  from  report  of  committee.) 

"The  factor  of  average  annual  production  not  only  serves  to  deter- 
mine the  length  of  life  but  the  average  annual  profit.  If  the  rate  of  pro- 
duction is  greater  than  estimated  the  profit  will  be  more  or  vice  versa. 
B.  is  dependent  upon  A.  and  is  subject  to  the  errors  of  A." 

Now,  for  practical  purposes  the  life  of  a  mining  property  may  be 
forecasted  for  purposes  of  valuation  for  the  current  year's  taxation  by 
an  observation  of  the  ratio  of  total  ore  reserves  to  the  average  produc- 
tion of  the  mine  in,  say,  four  or  five  or  seven  preceding  years.  Remem- 
ber, neither  Mr.  Steele  nor  the  committee  seems  to  take  this  into  ac- 
count. Let  your  forecast  stand  but  for  one  year.  You  are  then  not  look- 
ing far  into  the  future;  you  are  continually  readjusting  your  forecast 
entirely  on  the  basis  of  past  experience;  therefore,  as  conditions  change, 
your  appraisal  insofar  as  it  affected  by  the  life  factor  is  automatically 
readjusted  to  the  changed  conditions. 

"The  cost  of  production  may  be  closely  estimated."  (Reading  from 
report  of  Committee).  It  certainly  can.  The  cost  of  production  is  a 
matter  of  record  on  the  books  of  the  mining  companies.  Now,  in  Michi- 
gan, as  before  mentioned,  each  mining  company  presents  to  the  Tax 
Commission  on  the  first  of  the  year  an  itemized  cost-sheet  made  up  on  a 
uniform  plan  and  formally  executed,  showing  what  the  cost  of  mining 


AMERICAN     MINING     CONGRESS  41 

has  been  for  the  preceding  five  years.  From  these  cost  sheets  the  ap- 
praiser is  able  to  figure  the  cost  of  production.  From  the  same  sheet  he 
also  knows  the  exact  amount  of  money  which  is  received  for  the  product, 
and  from  the  two  figures  he  is  able  to  calculate  the  profit  or  loss  per  ton, 
as  the  case  may  be.  There  is  no  guess  work  about  this.  We  do  not  take 
account  of  what  is  going  to  happen  in  the  future.  We  say,  here  is  the 
full  operating  experience  of  this  mine;  we  will  use  it  as  the  basis  for  a 
forecast  to  stand  for  one  year  only;  next  year  we  will  drop  an  old  year 
and  take  on  a  new  one;  so  that  our  forecasts  will  always  be  made  on 
the  basis  of  the  preceding  five  years'  experience.  Now  you  will  see  if 
that  system  is  carried  along  from  year  to  year  it  will  wipe  out  most  of 
these  objections  which  are  based  upon  inability  to  make  accurate  fore- 
casts. 

MR.  GATES:  Are  their  expenses  not  allowed  in  making  that  state- 
ment 

MR.  ALLEN:  In  making  up  the  cost  statement  all  operating  ex- 
penses are  allowed  including  taxes  as  an  operating  expense.  We  do 
not  allow  capital  charges  or  royalties.  We  allow  any  amount  of  money 
for  development  on  the  particular  properties  appraised  but  we  do  not 
allow  cost  of  prospecting  in  scattered  localities  outside  the  boundaries 
of  the  mining  properties  themselves.  In  other  words  we  must  conclude 
in  this  work  that  the  mining  men  are  themselves  the  best  judges  of  what 
is  good  mining  business,  and  if  they  think  it  is  good  business  to  spend 
money  in  development  work  in  trying  to  improve  their  properties  by  cre- 
ating additional  values,  then  that  is  good  business  for  Michigan;  and 
that  money  has  of  course  got  to  be  sunk  by  the  proceeds  of  the  ore  ac- 
tually mined. 

We  do  not  question  the  motives  of  the  mining  men  in  their  expendi- 
tures; we  do  not  substitute  our  judgment  for  theirs,  when  it  comes  to 
matters  of  that  kind.  Those  expenses  must  be  allowed  if  they  have  ac- 
tually been  incurred.  And  I  want  to  say  here  that  in  three  years'  experi- 
ence with  this  system  in  Michigan  I  have  never  found  one  single  case 
where  I  even  suspected  that  the  mining  men  were  trying  to  "put  some- 
thing over"  on  the  State  Tax  Commission  or  upon  the  appraiser.  (Ap- 
plause.) 

MR.  L.  S.  GATES:    What  about  the  capital  expenditures? 

MR.  ALLEN:  If  the  property  has  been  bought,  the  company  will 
doubtless  make  provision  for  a  sinking  fund  with  which  to  replace  the 
capital  outlay.  This  is  not  a  proper  charge  under  our  system.  We  also 
figure  royalties  as  profits  for  royalties  must  be  paid  out  of  profits  on 
the  ore. 

A  mining  property  which  has  never  made  a  profit  or  which  has  no 
reasonable  prospect  of  making  a  profit  pays  no  taxes  as  a  mine.  It 
represents  a  total  loss.  We  wipe  it  off;  we  do  not  call  it  a  mine;  it  is 
so  much  land.  Whatever  the  land  is  worth  as  a  farm  or  for  city  lots  or 
for  anything  else,  it  will  be  assessed  for  on  that  basis,  but  it  has  no  value 
as  a  mine.  But  the  legislature  has  required  the  appraisal  of  all  reserva- 
tions of  mineral  rights.  That  has  lead  to  the  division  of  mineral  lands 
into  three  classes  known  as  A,  B  and  C.  Those  which  have  reasonable 
possibilities  of  ore  occurrence  were  put  into  those  three  classes.  In  all 
other  lands,  irrespective  of  whether  there  were  reservations  of  the  min- 
eral rights  in  deeds  or  not,  the  mineral  rights  were  appraised  at  zero. 
In  other  words,  the  state  of  Michigan  does  not  intend  to  tax  mineral 
lands  wherein  there  are  no  certain  evidences  of  mineral  values. 

MR.  GATES:    What  constitutes  the  lands  classed  as  A,  B  and  C 

MR.  ALLEN:  It  would  be  rather  difficult  and  would  take  a  good  deal 
of  time  to  explain  that.  The  classification  is  made  on  a  geological  basis. 


42  OFFICIAL     PROCEEDINGS 

The  class  A  lands  are  the  best  class;  class  B  are  the  second  class,  and 
the  class  C  lands  are  the  third  class.  The  ratio  of  value  between  these 
classes  is  estimated  to  be  12*£  to  7^  to  2%.  Personally,  I  made  the 
recommendation  that  these  lands  be  not  taxed,  because  evidence  of  in- 
trinsic value  is  lacking,  but  that  if  they  must  be  taxed  the  valuation  be 
a  nominal  one.  Finally,  after  threshing  the  question  over,  the  Tax  Com- 
mission concluded  to  adopt  that  ratio  and  assessed  the  mineral  lands  at 
$12.50,  $7.50  and  $2.50  per  acre  respectively.  It  is  an  arbitrary  valuation. 
I  do  not  believe  that  any  higher  value  should  be  placed  upon  lands  which 
are  merely  presumed  to  have  mineral  value  in  consequence  of  their 
geological  situation  or  proximity  to  mines,  etc. 

To  return  now  to  the  point  at  which  I  was  interrupted, — likewise, 
referring  to  "B,"  the  average  annual  profit  assumed  is  governed  purely 
by  the  operating  record  of  the  mine  as  shown  on  the  books  of  the  com- 
pany. This  forecast,  like  all  others,  stands  for  one  year  only. 

Under  "F"  the  report  says:  "The  rate  of  interest  is  a  factor  that 
may  be  adjusted  to  suit  the  individual  in  private  work.  For  taxation  pur- 
poses the  worth  of  money  is  a  debatable  question,  but  a  rate  should  be 
used  that  will  represent  the  actual  earning  power  of  the  money  without 
special  effort.  If  the  business  is  hazardous,  all  factors  of  safety  will 
properly  have  been  provided  in  the  basic  factors." 

Now,  I  might  say  that  this  question  of  interest  rate  to  be  used  in 
amortizing  capital  or  in  figuring  present  worth  is  still  a  bone  of  con- 
tention between  the  mining  men  of  Michigan  and  the  Tax  Commission. 
The  question  of  interest  rate  revolves  about  the  question  of  the  elimina- 
tion of  the  hazards  of  mining.  Mining  is  a  hazardous  business.  The  ap- 
praiser must  in  some  way  or  other  in  his  calculations  of  values  make 
due  allowance  for  the  hazards  of  mining.  Now,  that  can  be  done  in  a 
number  of  ways.  As  Mr.  Steele  suggests,  it  may  be  done  by  taking  a 
conservative  position  on  the  value  of  other  factors,  or  it  may  be  done  by 
allowing  a  large  rate  of  interest  on  capital  in  the  calculation  of  present 
worth  of  expected  profits,  say  ten  per  cent.  The  mining  men  are  not  will- 
ing to  agree  that  a  smaller  rate  should  be  used.  Practically,  we  get  at 
it  in  this  way:  We  realize  that  hazard  rates  must  be  varied  to  suit  the 
varying  hazards  from  mine  to  mine.  There  are  some  iron  mines  in  Mich- 
igan in  which  the  investment  is  safer  than  ownership  of  some  bank  stock. 
Some  mines  have  been  running  for  many  years,  year  after  year,  at  a 
steady  profit,  with  almost  unvarying  physical  conditions  in  the  mine, 
and  plenty  of  good  ore.  There  are  practically  no  hazards  in  such  a  mine 
on  a  conservative  estimate  of  tonnage.  On  the  other  hand  we  have 
mines  wherein  the  ore  is  low  grade,  the  mining  conditions  are  unsatis- 
factory and  the  hazard  rates  are  high.  Consequently  we  have  to  vary 
the  hazard  rates  in  accordance  with  the  varying  conditions.  Now,  if  we 
were  to  be  ultra-scientific  and  do  the  thing  just  right,  the  hazard  rates 
should  be  treated  as  a  function  of  the  interest  rate.  That  would  involve 
a  sliding  scale  of  interest  rates  to  be  applied  in  the  judgment  of  the  ap- 
praiser and  would  introduce  another  element  of  complexity.  We  con- 
cluded finally  to  treat  capital  at  the  common  rate  of  six  per  cent,  and  the 
sinking  fund  at  the  same  rate,  for  the  reason  that  in  practice  profits  or 
income  from  mining  are  invested  and  reinvested  in  the  mining  business 
and  by  the  mining  companies  themselves  are  treated  as  so  much  new 
capital.  If  that  were  not  the  case  the  application  of  the  six  per  cent  rate 
to  a  sinking  fund  could  not  be  justified.  The  hazard  rate  which  is  ap- 
plied to  individual  properties  ranges  all  the  way  from  nothing  to  a  fifty 
per  cent  cut  from  the  ultimate  figures  and  is  in  the  nature  of  a  flat  per- 
centage. Allowance  for  hazards  is  a  matter  requiring  the  exercise  of  con- 
servative good  judgment  and  no  other  factor  in  the  calculation  demands 
more  careful  attention  from  the  appraiser. 

I  think  I  have  already  been  given  more  time  for  the  discussion  of 
this  question  than  I  have  been  entitled  to,  and  I  fear  that  I  have  abused 


AMERICAN     MINING     CONGRESS  43 

your  courtesy.  I  will  be  very  glad  to  answer  any  question  you  may  like 
to  ask  about  the  Michigan  system,  and  in  closing  my  remarks  I  would 
like  to  emphasize  a  few  things  to  which  I  referred  a  while  ago.  In  view 
of  the  tremendous  influence  on  public  sentiment  that  is  exercised  by  the 
American  Mining  Congress — and  it  is  a  tremendous  influence — we  should 
avoid  committing  ourselves  to  any  general  program  of  mine  taxation. 
We  must  remember  that  the  conditions  under  which  mining  operations 
are  carried  on  vary  greatly.  Problems  in  mine  taxation  are  varied  not 
only  in  consonance  with  the  diverse  character  of  the  mines  throughout 
the  country  but  also  with  the  different  social  and  political  aspects  of  the 
question  in  the  different  states.  I  would  not  go  so  far  as  to  say  that  the 
ad  valorem  tax,  under  your  conditions  in  Arizona,  is  the  best  tax  for 
Arizona,  but  I  believe  that  the  mining  men  of  Michigan  will  support  me 
in  the  statement,  as  I  know  the  Tax  Commission  will,  that  it  is  the  best 
system  for  Michigan.  It  is  the  best  system  we  have  ever  been  able  to 
devise  in  Michigan.  It  has  taken  four  years  to  develop  it,  and  it  is  going 
to  take  several  more  years  before  either  the  mining  men  or  the  Tax 
Commission  will  be  entirely  satisfied  with  the  work.  It  is  a  distinctly 
co-operative  enterprise.  The  mining  men  of  Michigan  are  cordially  back 
of  it,  and  we  work  together.  Any  man,  no  matter  what  his  training  has 
been  or  what  his  ability  may  be,  who  starts  out  to  make  mine  appraisals 
on  the  wholesale  plan,  such  as  the  appraisals  in  Arizona  or  in  Michigan, 
and  who  does  not  have  the  active  and  cordial  co-operation  of  the  opera- 
tors themselves,  is  going  to  fall  down,  because  he  is  tackling  a  job  which 
is  above  the  power  of  a  single  human  being  unaided  to  accomplish. 
Gentlemen,  I  thank  you.  (Applause.) 

THE  PRESIDENT:  Gentlemen,  Mr.  Allen's  discussion  has  been  very 
interesting  and  is  developing  many  new  aspects  that  perhaps  many  of 
us  haven't  thought  about.  We  would  like  to  hear  from  others. 

MR.  DAY:  Mr.  President  and  Gentlemen:  It  may  interest  you  to 
know  something  of  the  experience  of  practical  miners  and  prospectors 
and  mill  men  in  the  state  of  Idaho  on  the  taxation  plans  in  operation 
there.  In  our  state  we  have  been  working  for  ten  years  under  a  net 
profit  system.  In  thinking  over  our  experience  in  connection  with  the 
report  of  the  committee  I  cannot  help  being  struck  with  the  similarity 
of  our  experience  and  their  views.  Some  ten  years  ago  the  question  of 
taxation  of  mines  was  first  agitated  in  the  state  of  Idaho.  Contrary  to 
the  experience  of  our  friend  from  Michigan,  the  mining  men  were  not 
only  willing  but  even  anxious  to  have  established  some  equitable  system 
of  mine  taxation.  With  that  end  in  view  they  co-operated  in  the  state 
legislature  with  the  best  thought  of  the  state  in  all  sections  and  the 
joint  result  of  their  efforts  was  a  net  profit  law  which  has  since  been 
in  satisfactory  operation.  In  accordance  with  the  suggestion,  or  rather 
in  advance  of  it,  the  first  thing  they  did  was  to  lay  down  what  we  may 
call  a  standard  method  of  accounting,  or  cost  sheet.  It  is  not  in  such 
great  detail  as  that  described  by  the  gentleman  from  Michigan,  but  it 
has  been  very  satisfactory  for  the  purposes  for  which  it  was  intended. 
A  certain  amount  of  expense  is  allowed  to  be  deducted,  freight  and 
treatment,  actual  cost  of  mining,  taxes,  and  actual  cost  of  rehabilitation 
or  repair  of  mines  is  allowed  to  be  deducted  from  the  gross  proceeds. 
The  net  profit  then  is  taxed  upon  the  regular  basis  paid  by  all  other 
property,  on  an  average  of  3%,  3%%  or  4%,  according  to  the  county  in 
which  the  property  is  situated.  In  addition  to  this,  the  mines  are  taxed 
upon  all  real  and  personal  property,  such  as  mills,  machinery  and  im- 
provements of  whatever  description  on  the  surface  or  underground  at 
the  same  rate  as  other  property  is  taxed,  and  it  has  worked  out — I  won't 
say  entirely  satisfactory,  but  satisfactory  to  a  large  majority  of  the 
people  of  the  state.  It  is  quite  true  that  it  is  not  entirely  satisfactory 
to  every  one.  In  the  last  legislature  there  happened  to  be  a  young  man 


44  OFFICIAL     PROCEEDINGS 

from  Kansas  who  had  been  18  months  in  the  state  of  Idaho,  and  as  soon 
as  he  got  into  the  state  of  Idaho,  or  shortly  thereafter,  he  introduced  a 
bill  to  raise  the  taxes  of  mines  to  ten  times  their  net  profits.  This 
gentleman  had  never  seen  a  mine;  he  had  never  worked  a  day  or  an 
hour  underground,  had  never  mined  or  milled  or  marketed  a  pound  of  ore 
in  his  life,  but  he  introduced  this  bill.  The  bill  was  killed,  of  course,  and 
the  gentleman  left  the  state.  He  had  no  interest  in  the  state,  and  no 
interest  in  the  mining  business;  and  the  agitation  in  favor  of  "soaking" 
the  mining  men  with  extraordinary  assessments  upon  his  property,  no 
matter  how  earnestly  he  has  worked  for  it,  emanates  largely  from  that 
kind  of  people  who  have  nothing  at  stake  and  who  do  not  realize  what 
it  means.  I  am  speaking  feelingly  on  this  matter,  as  I  have  had  a  large 
experience  as  prospector,  miner,  mill  man  and  operator  and  have  lived 
for  25  or  30  odd  years  on  the  Pacific  coast. 

Now,  the  Committee  has  suggested  here,  on  page  2:  "The  mineral 
contents  and  value  of  unexplored  *  *  *  cannot  be  obtained."  It 
seems  to  me  that  is  very  clearly  put.  And  in  the  quotation  from  the 
Wisconsin  Tax  Commission's  report  for  1910,  it  is  stated:  "It  would 
be  more  logical  and  tend  to  better  administration  *  *  *  without 
regard  to  the  minerals  *  *  * " 

In  regard  to  the  assessment  of  non-producing  mining  claims,  it  seems 
to  me  they  should  not  be  assessed  at  all.  They  are  only  an  expense  to 
the  owner;  he  doesn't  get  anything  out  of  it.  He  keeps  up  the  assessment 
work  each  year  or  he  forfeits  his  title,  and  he  puts  in  as  much  more  as 
he  can  dig  up.  He  has  great  faith  in  his  ground,  and  every  owner  of  a 
claim  knows  there  is  a  bonanza  in  it  and  he  puts  all  the  money  he  can 
get  into  that  claim.  He  puts  that  money  into  circulation  and  is  employ- 
ing labor  and  putting  in  his  own  time  perhaps  and  taking  a  chance  of 
getting  something  out  of  it,  and  as  long  as  it  produces  nothing  it  should 
not  be  assessed. 

A  DELEGATE :  Doesn't  that  refer  to  non-producing  patented  mining 
claims? 

MR.  DAY:  It  says,  "non-producing  mining  claims."  I  believe  the 
Committee's  suggestion  is  well  made,  that  such  should  not  be  taxed.  I 
further  believe — and  this  is  based  upon  experience — that  patented  min- 
eral ground  should  be  taxed  at  its  cost  price,  that  is,  for  instance,  at  $5 
an  acre,  the  price  the  government  charges  for  non-producing  mineral 
land,  and  that  is  certainly  all  it  should  bear,  in  fairness  and  justice,  and 
d  take  it  that  all  any  of  us  wants  is  a  fair  deal.  I  believe  the  great 
American  people  are  entirely  fair  and  want  to  treat  the  mining  industry 
fairly  if  we  can  only  get  our  case  before  them. 

Reference  has  been  made  by  several  of  the  gentlemen  who  have 
preceded  me  to  the  matter  of  the  equity  of  a  mine,  that  is,  the  amount  esti- 
mated for  taxation  purposes,  and  the  term  "ad  valorem"  is  used  in  this 
report.  What  is  the  meaning  of  the  term  "ad  valorem"?  Simply  "accord- 
ing to  value."  And  we  then  come  down  to  analyzing  the  matter,  and 
the  question  is  presented  as  to  what  is  the  worth  of  a  mine.  Is  it  what 
you  think  it  is  worth,  or  what  the  public  thinks  it  is  worth,  or  what  the 
people  who  buy  and  sell  stock  on  an  exchange  think  it  is  worth — the 
speculative  value?  None  of  these  items  constitute  the  value.  The  value 
of  the  mine  is  what  you  get  out  of  it  after  it  is  worked  out — the  ultimate 
value.  Then  if  we  would  be  equitable  in  the  matter  we  would  agree  to 
be  charged  on  that  value,  and  I  think  we  are  all  willing  to  be  taxed  on 
that  basis  or  should  be  willing  to  be  so  taxed.  How  are  you  going  to 
arrive  at  it?  Are  you  going  to  arrive  at  it,  as  our  friend  from  Michigan 
has  outlined,  by  taking  the  books  of  the  mining  company  for  seven 
years  past  and  prognosticating  the  future  from  that?  How  would  he 
apply  that  to  this  year  when  the  price  of  copper  in  this  state  has  dropped 


AMERICAN     MINING     CONGRESS  45 

to  such  a  degree  that  a  large  number  of  mines  throughout  the  West  are 
closed  down? 

MR.  ALLEN:  Why,  this  year  would  average  up  with  the  preceding 
years. 

MR.  DAY:  I  understood  you  took  seven  years'  prior  production  and 
based  the  next  preceding  year  on  that.  Is  that  correct? 

MR.  ALLEN:  No,  I  think  you  misunderstood  me.  Each  year  we 
make  our  forecast  on  the  basis  of  the  experience  of  the  preceding  five 
years.  The  mines  are  annually  reappraised.  Therefore  this  year,  which 
is  a  very  poor  year  for  Michigan  copper  as  well  as  iron,  will  be  averaged 
in  with  four  fair  years,  and  the  books  will  show  that  the  average  earning 
power  of  a  ton  of  ore  or  a  pound  of  copper  is  reduced ;  consequently,  the 
valuation  of  the  mines  automatically  goes  down.  If  we  have  another 
bad  year  it  will  go  down  further.  And  then  when  we  get  some  good 
years  they  will  come  up  again.  But  by  taking  a  five-year  average  we 
eliminate  sharp  fluctuations.  That  is  the  reason  we  take  five  years. 

MR.  DAY:  I  don't  undertake  to  criticize  the  Michigan  law  or  its 
operation  for  the  reason  that  I  haven't  made  a  thorough  study  of  it,  but 
at  the  same  time  it  has  only  been  in  operation  four  years,  and  I  under- 
stand the  conditions  of  iron  and  copper  mining  in  Michigan  are  vastly 
different  from  those  obtaining  in  the  Western  mines.  I  understand  that 
they  have  very  large  conglomerate  deposits  and  differ  very  much  from 
anything  we  have  in  the  Western  country,  and  therefore  I  conceive  their 
conditions  are  not  applicable  to  us  here  in  the  West.  Now,  in  regard 
to  the  net  profit  proposition,  as  I  have  said,  we  have  found  this  almost 
entirely  satisfactory — in  fact  I  think  it  is  entirely  satisfactory  to  those 
people  who  belong  in  the  state,  who  have  their  property  interests  there, 
which  tie  them  to  the  state  for  a  long  term  of  years,  and  I  think  those 
are  the  people  who  are  entitled  to  consideration  in  this  matter,  and, 
personally,  I  feel  like  heartily  indorsing  the  report  of  the  Committee, 
with  the  possible  exception  of  the  article  on  the  last  page:  "(b)  That 
if  a  tax  upon  the  net  proceeds  only  of  mines  of  a  state  would  be  insuf- 
ficient to  produce  the  revenue  necessary  for  the  state's  purposes,  or  to 
produce  that  necessary  revenue  would  run  the  rate  of  taxation  in- 
ordinately high,  then  a  fair  system  of  capitalizing  the  net  proceeds  at  a 
figure  which  at  the  prevailing  rate  of  taxation,  would  produce  the  re- 
quired revenue,  would  be  a  proper  system."  In  other  words,  they  would 
capitalize  the  profits,  as  I  take  that  to  mean.  It  is  only  a  suggestion  by 
the  Committee.  It  seems  to  me  from  a  lifetime  of  experience  that  such 
capitalization  of  the  profits  of  mines  as  a  basis  of  taxation  is  not  a  sound 
proposition.  Those  of  you  who  have  put  in  your  lives  at  the  business  will 
readily  understand  how  the  hazards  of  mining  differ.  There  is  the  un- 
certainty as  to  values,  the  cost  of  materials,  labor  conditions,  and  a. 
thousand  and  one  things  that  go  to  make  the  business  extraordinarily 
hazardous.  Yesterday  I  was  talking  with  one  of  the  most  distinguished 
members  of  this  conference,  Dr.  Holmes  of  the  Bureau  of  Mines,  and 
he  has  lately  criticized  the  mining  companies  very  sharply,  the  metal- 
liferous mines,  for  the  large  number  of  fatalities  and  accidents  under- 
ground, and  it  is  suggested  that  at  least  half  of  the  fatalities  and  three- 
fourths  of  the  casualties  were  uncalled  for  or  could  have  been  prevented 
by  proper  methods.  Now,  that  is  certainly  a  very  harsh  criticism.  As 
much  as  I  respect  Dr.  Holmes — and  I  do  respect  him  sincerely — I  think 
he  is  making  a  very  sweeping  statement  in  that  respect.  I  do  not  think 
the  mines  are  so  largely  responsible  for  that  as  his  statement  would 
tend  to  show;  but  it  only  tends  to  illustrate  one  of  the  hazards  of  the 
business  which  a  great  many  people  who  have  not  had  wide  contact 
with  it  do  not  understand.  The  business  is  judged  as  every  other 
business  on  the  top  of  the  ground  which  can  be  seen  up  one  side  and 
down  the  other.  A  short  time  ago  I  was  in  a  political  convention  iiL 


46  OFFICIAL     PROCEEDINGS 

our  state  and  we  were  talking  over  this  very  matter  of  the  taxation  of 
mines.  A  resolution  was  before  the  house  to  go  into  the  platform,  a 
plank  with  reference  to  the  taxation  of  mines  as  they  are  taxed.  I  op- 
posed it,  and  in  the  course  of  the  debate  I  came  into  conflict  with  a 
farmer,  a  very  sincere  man,  and  we  argued  the  matter  back  and  forth, 
and  I  finally  said  to  him,  "Would  you  be  willing  to  pay  taxes  on  your 
growing  crop?"  He  said,  "No."  I  said,  "That  seems  to  me  akin  to  taxing 
the  ore  in  the  ground,  and  the  ore  that  is  out  of  sight;"  and  he  said, 
"Well,  I  never  thought  of  that;"  and  he  quit  right  there;  and  I  am  going 
to  quit  right  here,  too. 

I  thank  you  for  listening  to  me  so  long.     (Applause.) 

THE  PRESIDENT:  Gentlemen,  we  still  have  some  time  left  before 
lunch  hour  for  further  discussion,  and  we  will  be  very  glad  to  hear  from 
you  fully  and  freely. 

MR.  J.  H.  MULHOLLAND:  Mr.  President  and  Gentlemen  of  the 
Congress:  In  presenting  the  views  of  a  newcomer  in  the  mining  busi- 
ness, gathered  from  past  experience,  I  would  like  to  do  so  in  a  few 
words.  I  was  born  in  Canada  and  lived  most  of  my  life  there,  and  in 
Western  Canada  we  have  an  adaptation  of  Henry  George's  single  tax. 
I  do  not  want  to  inject  a  discussion  of  single  tax  into  this  meeting,  but 
we  have  had  some  experience  up  there,  and  I  wish  to  call  attention  to 
this  side  issue,  possibly,  in  the  taxation  of  mines.  We  have  come  to 
the  conclusion  in  Western  Canada  that  it  is  not  proper  to  fine  a  man  for 
improving  his  property.  That  basis  was  not  arrived  at  through  any 
abstruse  consideration  of  economics,  but  simply  because  we  have  large 
areas  of  land  in  Western  Canada  held  by  corporations  that  would  not 
improve  it  but  held  it  solely  for  speculative  purposes.  The  Canadian 
Pacific  Railway  held  some  25,000,000  acres  of  land  in  alternate  sections. 
A  farmer  there  would  go  in  and  homestead  on  the  even  numbered  sec- 
tions, while  the  odd  numbered  sections  would  be  held  by  the  Canadian 
Pacific.  When  a  school  district  was  to  be  formed,  or  anything  of  that 
sort,  the  taxes  to  support  such  institution  were  levied,  and  the  man  who 
had  improved  his  farm,  put  a  fine  house  on  it,  and  a  barn,  and  fenced 
it,  stocked  it,  plowed  it  and  brought  it  into  cultivation  was,  under  the 
old  system,  taxed  for  those  improvements.  He  had  enhanced  the  value 
of  the  four  sections  surrounding  him  belonging  to  the  corporation,  and 
with  which  nothing  had  been  done;  he  had  raised  the  value  of  the  land 
in  his  community;  and  they  decided  that  they  were  not  going  to  fine 
this  man  for  improving  his  property.  I  think  the  same  thing  will  apply 
to  mining.  Why  should  a  man  fine  himself  or  why  should  his  state  fine 
him  for  improving  his  property,  putting  a  well  on  it,  putting  machinery 
into  it,  or  developing  it?  I  approve  of  taxes  on  the  original  value,  if  it 
can  be  arrived  at  in  the  same  fashion  as  is  done  in  Michigan,  or,  if  that 
cannot  be  successfully  done,  on  the  basis  of  the  net  income  from  the 
property;  but  the  machinery  for  producing  that  income,  or  the  ma- 
chinery which  establishes  the  ad  valorem  value  of  the  property,  which- 
ever system  is  used,  is  not  a  proper  subject  of  taxation.  I  wish  to  com- 
mend this  idea  to  your  consideration.  (Applause.) 

THE  PRESIDENT:  You  may  be  interested  to  know  that  one  of  our 
companies,  operating  in  Oklahoma,  at  the  first  legislative  session  in 
that  state  seven  years  ago,  was  placed  under  the  gross  income  tax, 
which  was  inaugurated  by  the  first  legislature,  of  2%  on  the  gross  income 
of  mines.  We,  of  course,  strenuously  resisted  it  but  it  was  fastened 
upon  us,  and  some  of  the  operators  paid  it.  Our  company  took  the 
position  that  we  would  not  pay  it,  so  at  the  succeeding  legislative  session 
some  of  the  legislators  came  around  and  asked  if  we  would  consent  to  a 
gross  revenue  tax  if  it  were  reduced  from  2%  to  %%.  I  took  the  po- 
sition that  if  2%  was  wrong  %%  or  1-10%  was  wrong,  and  the  last  infor- 
mation I  had  as  I  left  home  last  Friday  was  of  a  decision  by  the  United 


AMERICAN     MINING     CONGRESS  47 

States  Supreme  Court  finding  in  our  favor,  that  the  tax  was  illegal  and 
could  not  be  enforced.  A  number  of  properties  had  paid  the  Vz%  as- 
sessment, but  our  company  had  not.  We  felt  that  a  tax  on  the  net 
income  might  be  proper,  but  we  did  not  think  a  gross  income  tax  was 
just,  and  our  views  have  been  vindicated  by  the  United  States  Supreme 
Court. 

Gentlemen,  we  still  have  some  time  left  for  further  discussion  of  this 
question. 

MR.  ALL/EN:  Mr.  President,  pardon  me  for  taking  the  floor  again, 
but  I  want  to  make  clear  to  some  of  the  members  and  delegates  who  are 
not  familiar  with  the  application  of  the  Michigan  system  that  the  valu- 
ation of  a  mine  includes  the  value  of  the  ore  in  stock  as  well  as  the 
value  of  the  machinery,  equipment,  shaft  house,  rails,  the  power  plant,, 
and  in  fact  the  whole  thing,  because  the  cost  of  these  is  reflected  in  the 
cost  sheet,  the  record  of  the  whole  operation,  and  the  money  which  is 
put  into  power  plants  and  power  stations  and  machinery  has  all  got  to 
be  returned  by  the  income  from  the  ore.  We  make  the  ton  of  ore  in 
the  ground  the  basis  of  all  values. 

THE  PRESIDENT:  I  would  like  to  ask  one  question  there,  Mr. 
Allen.  Did  you  say  that  interest  rate  was  not  allowed? 

MR,  ALLEN:     Yes. 

THE  PRESIDENT:  I  understood  you  to  say  interest  was  not  al- 
lowed as  an  item  of  cost. 

MR.  ALLEN:  It  is  not.  Not  interest  on  borrowed  money.  That 
is  a  capital  account;  it  is  not  allowed  in  figuring  the  cost  of  mining  for 
the  reason  that  full  allowance  for  return  of  investment  or  capital  is 
made  in  figuring  present  worth  of  expected  profits. 

THE  PRESIDENT:  How  would  you  treat  bonds  if  the  property  is 
bonded?  Is  that  borrowed  money? 

MR.  ALLEN:  Yes.  That  is  not  a  proper  item  to  enter  into  the  cost 
sheet,  from  our  point  of  view.  But  I  was  going  to  explain  one  condition 
that  we  have  in  Michigan  which  shows  how  the  system  works  out  in 
practice.  There  is  a  certain  mining  company  that  has  a  number  of 
iron  mines.  They  have  spent  a  large  sum  of  money  in  putting  in  a 
hydro-electric  plant  with  distributaries.  These  distributaries  extend 
through  various  assessment  districts.  We  could  have  them  pro  rate  the 
cost  and  upkeep  of  that  power  plant  to  their  individual  mines,  and  the 
value  which  is  put  upon  the  mines  would  in  this  case  include  the  value 
of  the  power  plant  with  its  distributaries  as  a  part  of  the  main  plant 
But  inasmuch  as  the  power  plant  is  assessable  in  two  or  more  districts 
we  have  them  enter  the  actual  cost  of  the  power  delivered  to  the  mines 
as  a  mining  cost  and  the  power  plant  is  assessed  as  a  separate  concern. 
It  is  merely  emphasizing  a  point  which  was  brought  to  mind  by  the 
discussion  of  Mr.  Mulholland,  that  under  the  Michigan  system  the  basis 
of  valuation  is  the  ton  of  ore,  because  the  ton  of  ore  has  got  to  pay  all 
the  bills;  and  all  the  cost  of  operation,  whether  it  be  for  railroads  or 
power  plants  or  what  not.  It  is  of  course  understood  that  such  equip- 
ment must  be  used  exclusively  as  an  agency  of  ore  production. 

MR.  HEREFORD:  I  would  like  to  ask  a  question.  I  cannot  quite 
understand  this  system  of  ad  valorem  valuation.  As  I  understand  you, 
the  ad  valorem  value  of  a  mine  is  based  by  you  upon  its  profit-producing 
qualities,  is  it  not?  What  is  the  difference  between  that  and  assessing 
net  profits?  Net  profits  you  can  ascertain  directly,  can  you  not,  from  the 
books  of  the  company  at  the  end  of  the  year?  The  profit-producing 
qualities  of  a  mine  you  can  only  get  at  either  by  its  past  history  in 
producing  profits  or  by  guess  work.  In  other  words,  isn't  your  ad 


48  OFFICIAL     PROCEEDINGS 

valorem  assessment  after  all  nothing  but  an  assessment  upon  the  sup- 
posed value  of  the  property  calculated  upon  the  assumption  that  it  will 
earn  so  much  money? 

MR.  ALLEN:     Exactly. 

MR.  HEREFORD:  Both  are  the  same.  You  are  assessing  upon  the 
profits  of  the  property.  Now,  under  the  net  profit  plan  you  have  the 
books  to  demonstrate  thoroughly  and  fully  what  that  profit  is,  but  under 
your  system  it  would  be  guesswork  as  to  what  the  net  profits  may  be. 
Now,  pardon  me  for  such  a  long  question,  but  I  am  anxious  to  know. 

MR.  ALLEN:  I  am  very  glad  that  you  brought  that  up.  I  find  in 
the  final  paragraph  of  this  report  of  the  Committee  that  they  foresee 
that  in  the  practical  application  of  the  tax  on  net  receipts  they  are 
going  to  be  forced  into  a  capitalization  of  profits.  Now,  the  ad  valorem 
system  of  mine  taxation  is,  as  you  say,  based  upon  the  earning  power 
of  a  ton  of  ore,  and  therefore  is  merely  the  present  worth  of  expected 
dividends,  nothing  more  nor  less;  but  according  to  the  Committee  the 
necessary  application  of  the  system  which  is  here  proposed  will  force, 
under  certain  contingencies,  a  capitalization  of  profits,  and  then  we 
get  back  to  practically  an  ad  valorem  system,  however,  with  all  its  vices 
and  none  of  its  virtues,  for  it  provides  no  means  for  ascertaining  the 
rate  of  capitalization,  which  must  be  governed  only  by  the  necessities  of 
government,  and  no  means  for  adjusting  the  burden  in  proportion  either 
to  the  value  of  the  properties  or  their  relative  abilities  to  pay  the  tax. 
And  here  is  another  thing  we  want  to  keep  steadily  in  mind — that  we 
in  Michigan  are  forced  to  the  ad  valorem  tax  as  a  matter  of  equaliza- 
tion of  tax  burdens.  Keep  that  right  in  mind.  It  is  a  matter  not  only 
of  mine  assessments  and  mine  valuations  but  a  matter  of  tax  equaliza- 
tion. Under  our  present  laws  we  cannot  discuss  mine  taxation  on  any 
other  basis,  because  we  are  prohibited  from  adopting  any  other  method. 
This  last  paragraph  is  not  very  clear  to  me.  Let  me  read  it: 

"(b)  That  if  a  tax  upon  the  net  proceeds  only  of  mines  of  a  state 
would  be  insufficient  to  produce  the  revenue  necessary  for  the  state's 
purposes,  or  to  produce  that  necessary  revenue  would  run  the  rate  of 
taxation  inordinately  high,  then  a  fair  system  of  capitalizing  the  net 
proceeds  at  a  figure  which,  at  the  prevailing  rate  of  taxation,  would  pro- 
duce the  required  revenue,  would  be  a  proper  system." 

As  I  understand  that,  the  government's  needs  must  first  be  de- 
termined, and  then  somebody,  some  taxing  authority,  must  arbitrarily 
determine  how  much  of  that  burden  has  got  to  be  borne  by  the  mining 
property  and  how  much  of  it  has  got  to  be  borne  by  other  properties. 
After  ascertaining  the  rate  of  taxation  on  other  property,  they  will  then 
arbitrarily  capitalize  the  mines  at  an  amount  which  is  sufficient,  under 
the  rate  applied  to  other  properties,  to  raise  the  amount  of  money  de- 
sired. Gentlemen,  is  that  the  substitute  offered  by  the  Committee  for  the 
so-called  non-scientific  ad  valorem  taxation?  Can  you  imagine  anything 
more  unscientific,  more  absurd,  more  bunglesome,  more  illogical  than 
such  a  procedure  as  that?  In  other  words,  the  taxing  authority,  if  I 
understand  this  paragraph  correctly,  must  determine  arbitrarily  how 
much  money  they  are  going  to  get  out  of  the  mines  and  then  go  out  and 
get  it,  capitalizing  the  mines  at  a  figure  which  will  be  necessary  to 
produce  the  revenue  which  they  desire  at  the  rate  of  taxation  applied 
to  other  property. 

MR.  HEREFORD:  I  haven't  quite  got  the  point  I  would  like  to 
understand.  If  I  understand  you,  the  ad  valorem  taxation  is  the  taxation 
for  the  expected  profits  of  the  mine.  Am  I  correct  in  that? 

MR.  ALLEN:     Yes. 

MR.  HEREFORD:  Why  is  not  the  taxation  of  the  net  value  a  tax- 
ation upon  the  absolute  value  of  the  profits  of  the  mine?  Why  is  the 


AMERICAN     MINING     CONGRESS  49 

ad  valorem,  which  is  based  upon  expectation,  equal  to  that  which  is 
definitely  determined  and  settled  by  the  actual  books  showing  the  net 
profits?  Now,  after  all,  you  seek  the  same  object.  The  one  proposition 
involved  is  the  taxation  upon  the  value  of  the  mine.  That  is  the  one 
object,  whether  you  call  it  ad  valorem  taxation  or  taxation  of  net  pro- 
ceeds. Now,  under  your  theory  you  tax  the  net  proceeds  of  the  cor- 
poration. Under  the  one  you  come  to  the  company  and  say,  "Well,  we 
expect  you  will  make  so  much  money,"  and  under  the  other  proposition 
the  company  goes  to  you  and  says,  "Here  are  our  books;  here  are  our 
net  profits;  tax  us  upon  them.  We  will  give  you  the  facts."  And  there 
is  another  thing  that  I  think  contains  a  little  force  in  that  connection. 
I  think  in  Arizona  we  spend  many  dollars  for  every  one  we  get  out  of 
the  ground.  It  is  not  true  in  Michigan  to  the  same  extent.  It  has  been 
said  that  it  costs  $5  to  $10  of  the  money  spent  in  the  mines  of  the 
country  to  extract  $1  of  profit.  Now,  under  those  circumstances  we 
capitalize  our  optimism  in  this  Sunny  West — what  we  expect  to  do  to  a 
great  deal  larger  extent  than  you  do  in  Michigan.  The  result  of  that 
is,  if  you  ask  a  man  to  sell  his  mine,  "No."  The  chances  are  he  will 
lose  every  dollar  he  has  put  into  it,  but  he  would  not  sell  it  for  a  million, 
therefore  you  couldn't  get  your  ad  valorem  value  of  that  mine  in  any 
way  except  by  guesswork.  How  can  that  be  subject  to  the  actual  de- 
termination of  the  value  by  the  books  of  the  company? 

MR.  ALLEN:  I  would  answer  you  in  this  way:  In  the  first  place, 
the  ad  valorem  system  taxes  nothing  but  that  which  has  a  demonstrable 
intrinsic  value.  I  tried  to  make  clear  in  the  beginning  that  from  the 
standpoint  of  the  mining  investor  and  the  mine  operator,  the  tax  on  net 
income  is  the  more  just  and  proper  tax.  Looking  at  it  from  that  view- 
point alone  I  would  favor  the  tax.  I  am  not  advocating  the  ad  valorem 
tax  as  a  substitute  for  the  tax  on  net  earnings  except  where  it  is  de- 
manded by  the  state  laws,  and  I  thought  that  I  made  myself  clear  that 
I  was  not  advocating  the  Michigan  system  for  Arizona.  I  don't  know 
whether  I  would  do  it  or  not,  because  I  don't  know  enough  about  Ari- 
zona to  determine  that  matter.  But  I  want  to  say  again  that  every 
problem  in  mine  taxation  in  our  state  is  also  a  problem  in  tax  equaliza- 
tion, and  I  should  like  to  ask  you,  if  I  may,  how,  under  your  proposed 
tax,  the  tax  proposed  by  this  Committee,  you  are  going  to  equalize  the 
amount  of  taxes  paid  by  the  mines  on  the  one  hand  and  other  property 
on  the  other  hand.  I  do  not  know  that  in  Arizona  you  need  to  equalize 
taxation,  but  we  do  need  to  do  it  in  Michigan;  and  if  we  substitute  for 
the  ad  valorem  system  the  tax  on  net  earnings  we  have  no  measure  of 
the  relative  burdens  of  taxation  on  mine  property  and  other  property. 
Do  I  make  myself  clear? 

MR.  HEREFORD:  Yes,  sir.  I  will  say  frankly  that  I  haven't  given 
the  subject  of  mine  taxation  sufficient  consideration  to  justify  me  in 
doing  anything  more  than  asking  questions;  but  since  I  have  put  myself 
in  a  position  where  I  should  answer,  I  will  give  you  my  view  in  regard 
to  it.  I  think  mines  should  be  considered  for  the  purposes  of  taxation 
as  they  are  generally  in  law.  You  can  sever  the  mineral  contents  of  the 
land  from  the  land  itself  and  sell  the  title  to  each  of  them  separately, 
and  I  think  taxation  should  be  based  to  some  extent  upon  the  value 
of  the  land  as  land,  but  that  the  taxation  of  a  mine  as  a  mine  should 
be  based  upon  its  production  of  profits.  The  idea  of  taxation,  I  think, 
is  to  put  the  burden  of  taxation  upon  those  who  are  able  to  carry  it.  I 
think  it  is  a  wise  thing  to  so  frame  your  laws  that  every  man  can  have 
an  opportunity  to  make  a  living;  therefore  I  think  that,  so  far  as  pos- 
sible, taxation  should  be  borne  by  those  who  are  best  able  to  stand  it 
and  in  proper  proportion.  The  question  of  taxation  cannot  be  reduced 
to  an  exact  science,  but  if  you  will  accept  it  under  the  laws  of  reason 
that  everywhere  obtain  in  the  mining  world,  I  think  we  will  get  nearest 
to  the  ideal  taxation.  Now,  it  is  a  recognized  fact  that  the  surface  and 


50  OFFICIAL     PROCEEDINGS 

other  portions  of  lands  which  are  available  for  minerals  can  be  sold 
separately  and  apart  from  the  mineral  contents  of  the  land,  and  I  think 
land  should  be  taxed — I  should  say,  roughly,  without  having  given  it  full 
thought — land  as  such  should  be  taxed,  wherever  any  title  is  held  to  it, 
separate  and  apart  from  the  mineral  it  contains.  But  I  think  lands 
should  be  taxed  very  largely  in  proportion  to  the  mineral  in  them  regard- 
less of  whether  or  not  there  is  a  paying  business,  just  the  same  as  any 
other  business.  I  think  the  land  and  the  minerals  should  be  taxed  sepa- 
rately. I  cannot  see  how  there  is  any  difference,  for  the  purposes  of 
taxation,  between  your  ad  valorem  plan  as  you  explain  it  and  that  of 
taxation  of  net  profits.  The  taxation  is  based  upon  the  earning  capacity 
of  the  property,  whatever  it  is,  and  I  think  the  wisest  way  is  to  stick  to 
the  rules  insofar  as  the  title  to  the  property  is  concerned.  Mineral  is 
one  thing  and  land  is  another.  Now,  I  don't  know  whether  I  have  made 
myself  clear.  I  didn't  intend  to  give  my  own  views,  because  I  do  not 
pretend  to  know  enough  about  the  subject  to  feel  that  they  are  of  value 
to  the  Congress;  but  I  am  simply  endeavoring  to  get  some  light  on  this 
matter. 

MR.  ALLEN:  Now,  just  to  carry  your  thought  a  little  bit  further: 
In  Michigan,  in  the  iron  and  copper  regions,  the  business  of  mining 
overshadows  all  other  industries.  The  mine  values  in  some  districts 
are  better  than  90%  of  all  values.  Now,  in  those  communities  the  local 
activities,  the  local  government,  and  the  county  government  and  the 
state  government  must  be  supported  and  must  have  an  income  whether 
the  mines  work  or  do  not  work.  The  people  cannot  stop  living  and  we 
cannot  stop  educating  the  children.  There  are  times  in  Michigan  when 
every  mine  in  some  of  the  assessment  districts  is  shut  down.  There 
are  no  profits,  and  there  is  no  production.  Under  your  system  there 
would  be  no  income  for  the  government.  We  have  got  to  take  a  little 
bit  broader  view,  as  I  suggested  in  the  beginning,  of  this  discussion  of 
mine  taxation.  The  needs  of  the  government  must  first  be  considered. 
And  there  is  another  point:  The  local  communities,  the  township  and 
the  county,  and  the  state,  too,  need  a  certain  and  steady  source  of  in- 
come. Under  your  system  the  taxes  each  year  would  have  to  be  levied 
on  the  income  of  the  preceding  year.  If  there  was  no  income  then,  there 
are  no  taxes  now. 

MR.  HEREFORD:  You  don't  take  into  consideration  the  value  of 
the  land  as  such? 

MR.  ALLEN:  I  am  speaking  of  the  land  in  these  mining  communi- 
ties. I  will  venture  to  say  that  the  land  values  in  your  mining  communi- 
ties in  Arizona  are  not  very  high;  they  don't  look  so  to  me.  There  is 
nothing  there  to  tax  but  the  mineral  value.  That  is  largely  true  in  the 
mining  regions  of  Northern  Michigan.  We  have  cut  the  timber  off  and 
there  is  little  value  there  for  timber  any  more,  and  there  is  very  little 
value  in  the  soil  in  some  districts.  I  hate  to  say  it,  but  some  of  the 
poorest  of  our  soil  is  not  any  better  than  you  see  on  your  hills,  despite 
the  fact  that  we  have  more  than  30  inches  of  rainfall.  Some  of  it  will 
not  bring  $5  an  acre  and  the  best  undeveloped  stump  land  not  more 
than  $15.  Now,  inasmuch  as  the  minerals  are  practically  the  only  value 
in  some  of  these  communities,  if  you  take  away  the  income  which  would 
be  provided  by  a  tax  on  net  income  of  the  mines,  as  you  propose,  then 
when  the  mines  cease  temporarily  to  operate  the  local  communities  are 
left  high  and  dry,  with  no  money.  The  schools  must  suspend,  and  there 
is  no  money  to  put  into  roads  and  other  necessary  public  works. 

MR.  HEREFORD:  Why  should  the  mine  which  you  say  does  not  pay 
bear  that  tax  when  the  land  doesn't  bear  it?  You  say  there  is  no  money 
there  unless  you  get  it  out  of  the  mine,  and  the  mine  doesn't  pay,  and 
still  you  want  to  make  the  mine  pay  the  tax. 


AMERICAN     MINING     CONGRESS  51 

MR.  ALLEN:  Now  you  are  getting  right  to  the  point.  You  have 
clinched  one  of  the  arguments  why  the  ad  valorena  system,  practically- 
considered,  is  a  better  system  of  taxation  than  your  tax  on  net  incomes 
right  there  in  that  statement,  because  there  is  value  in  those  mines 
whether  they  are  for  the  time  being  producing  or  not  for  causes  which 
are  familiar. 

MR.  HEREFORD:     How  do  you  know? 

MR.  ALLEN:     Well,  that  is  merely  begging  the  question. 

MR.  HEREFORD:     You  are  guessing. 

MR.  ALLEN:  We  are  not  guessing.  Pardon  me  for  speaking  so 
abruptly.  I  get  a  little  bit  out  of  patience  with  that  word  "guessing." 
General  suspension  of  operations  in  Michigan  have  never  been  due  to 
the  exhaustion  of  ore  even  in  a  single  limited  district.  Such  suspensions 
are  due  solely  to  bad  market  conditions.  A  mine  holding  reserves  of  ore 
is  valuable  even  though  it  may  for  the  time  being  be  inoperative.  We 
are  not  guessing;  in  making  a  reasonable  forecast  based  upon  past 
experience  you  use  exactly  the  same  kind  of  judgment,  exactly  the  same 
processes  of  thought,  that  you  use  in  the  every  day  business  life  that 
you  lead.  There  is  nothing  certain  in  mine  taxation  or  any  other  kind 
of  taxation,  but  to  say  that  the  appraiser  is  merely  guessing  at  the  value 
of  mining  property,  in  the  light  of  the  four  years  of  experience  we  have 
had  in  Michigan,  is  a  palpably  absurd  statement  and  unworthy  of  a 
place  in  a  serious  discussion.  I  want  to  say  that  when  you  get  right 
down  to  the  itemized  cost  sheets  of  the  mining  companies,  most  of  your 
hazards,  all  of  your  guesses  and  practically  everything  else,  with  the  ex- 
ception of  estimate  of  prospective  ore,  comes  out  in  the  wash,  because 
you  have  got  an  actual  measure  of  the  productive  power  of  the  ton  of 
ore  and  the  average  earning  capacity  of  the  properties.  In  merely  ex- 
tending your  forecast  for  one  year's  valuation  on  the  basis  of  the  ex- 
perience of  the  preceding  five  years  you  are  doing  no  violence  to  con- 
servative reasoning.  The  forecast  usually  comes  pretty  close  to  experi- 
ence for  the  very  reason  that  it  is  based  on  averages  and  we  find  as  we 
go  along  from  year  to  year  that  we  come  mighty  close  to  "guessing," 
if  you  prefer  the  term,  to  what  the  conditions  are  going  to  be. 

MR.  J.  C.  GOODWIN:  I  understood  you  to  say  a  while  ago  that 
your  lands  in  Michigan  are  divided  into  two  classes — mineral  and  non- 
mineral.  In  this  country  we  have  what  we  call  prospects,  which  do  not 
show  any  mineral  to  amount  to  anything.  We  patent  those  claims.  Those 
claims,  as  I  understand,  we  pay  taxes  on  of  so  much  without  regard  to 
any  mineral  contents  in  them,  just  so  much  on  a  claim.  Now  I  under- 
stand in  Michigan  your  mineral  claims  that  do  not  produce  anything 
are  put  into  three  classes,  A,  B  and  C,  as  you  said  a  while  ago,  and  that 
the  land  value  is  taxed  on  what  might  be  underground  as  minerals  just 
the  same  as  our  claims  in  this  state. 

MR.  ALLEN:  I  am  sorry  to  state  that  we  do  tax  at  a  very  nominal 
rate  all  lands,  classified  as  mineral  lands,  which  have  prospects  of  pro- 
ducing ore.  I  think  the  time  is  at  hand  when  we  are  going  to  quit  doing 
that.  The  claim  you  speak  of,  if  in  Michigan,  would  not  be  taxed.  The 
mineral  value  would  be  considered  as  zero,  and  it  would  pay  no  tax. 
There  is  a  reference  made  to  that  matter  by  the  Committee  in  quoting 
the  Wisconsin  Tax  Commission,  and  I  would  like  to  ask  the  member  of 
the  Committee  who  is  present  if  the  words  in  parentheses  are  those  of 
the  Committee  or  of  the  Wisconsin  Tax  Commission:  The  quotation  to 
which  I  refer  is  as  follows :  "It  would  be  more  logical  and  tend  to  better 
administration  if  the  lands  (non-producing  mineral  claims)  were  assessed 
without  regard  to  minerals." 

MR.  CLARK:  This  matter  came  to  me  in  the  shape  of  telegrams  and 
reports.  It  purports  to  give,  however,  the  words  of  the  Tax  Commission. 


\       '     '•-  *  V  .7,  ;-t  O  I  |  y       / 
X      ,- .       <•'*  / 


52  OFFICIAL    PROCEEDINGS 

MR.  ALLEN:  It  occurred  to  me  that  the  words  in  parentheses  were 
the  words  of  the  Committee;  and  it  also  occurred  to  me  that  the  ideas 
of  the  Wisconsin  State  Tax  Commission  were  a  little  bit  misrepresented 
here.  We  have  no  such  term  as  "mining  claim"  in  Wisconsin  or  in 
Michigan.  In  speaking  of  lands  here  the  Wisconsin  Tax  Commission 
is  doubtless  talking  about  lands  in  the  sense  that  I  am  talking  about 
mineral  lands,  and  not  lands  which  are  known  to  contain  ore  bodies 
but  which  are  non-producing.  For  instance,  if  we  have  ten  million 
tons  of  iron  ore  in  a  property  it  is  taxed  whether  it  is  worked  or  not 
because  it  is  valuable.  It  would  be  taxed  in  Wisconsin,  and  I  do  not 
expect  ever  to  see  the  people  of  Wisconsin  allow  any  such  taxable 
asset  to  escape,  because  it  is  against  the  whole  practice  of  the  taxing 
authorities  in  Wisconsin,  and  I  think  that  inasmuch  as  Wisconsin  has 
only  recently,  within  a  year  or  two,  adopted  the  Michigan  system  for 
the  taxation  of  iron  mines,  it  will  hardly  be  fair  to  quote  the  Tax 
Commission  in  this  connection  as  favoring  the  non-taxation  of  mineral 
lands  which  are  known  to  contain  ore  bodies  but  which  do  not  produce 
ore.  They  are  speaking  here  of  mineral  lands  which  may  be  supposed 
to  contain  ore  but  which  are  not  known  to  contain  ore;  in  other  words, 
the  kind  of  thing  that  geologists  and  mining  men  would  refer  to  as  a 
"favorable  prospect,"  or  a  "likely  looking  piece  of  land."  or  something  of 
that  sort. 

MR.  UTTER:  Mr.  President,  I  would  like  to  ask  the  gentleman 
from  Michigan  two  questions.  We  understand  the  spirit  of  the  American 
citizen  is  for  fair  dealing  for  all  parties.  Does  a  farmer  pay  taxes  on 
his  land  and  on  his  improvements  and  also  pay  taxes  on  his  net  profits — 
say  his  apples  and  his  alfalfa  and  his  potatoes  and  so  forth?  Does  the 
merchant  who  pays  taxes  on  something  less  than  the  wholesale  cost  of 
his  goods  also  pay  a  tax  on  his  net  profits,  in  Michigan  or  any  other 
state?  I  think  the  same  rule  should  apply  to  all  taxable  property. 

MR.  DERN:  Mr.  President,  it  seems  to  me  that  possibly  such  di- 
vergence of  opinion  as  has  been  manifested  here  is  due  to  the  fact  that 
we  are  considering  two  different  sets  of  conditions.  Possibly,  as  Mr. 
Allen  has  said,  the  Michigan  system  of  mine  assessments  is  the  best  one 
for  Michigan  conditions,  but  for  various  reasons,  as  stated  by  Mr.  Day 
and  others,  it  is  not  applicable  to  Western  conditions.  In  the  copper 
and  iron  mines  of  Michigan  they  frequently  have  immense  available 
ore  reserves,  upon  which  a  valuation  can  be  placed.  We  have  very  few 
mines  out  West  in  which  a  great  tonnage  of  ore  is  developed  beforehand, 
and  yet  some  of  them  are  very  profitable.  I  know  of  a  mine  that  during 
the  first  half  of  a  twelve  months'  period  was  paying  good,  healthy  divi- 
dends, and  during  the  second  half  it  was  levying  good,  healthy  assess- 
ments. Now  it  is  entirely  possible  that  if  this  mine  had  been  examined 
at  the  time  specified  by  law  for  making  the  annual  assessment,  no 
reserves  would  have  been  found,  and  hence  there  would  have  been  no 
value  to  assess.  During  the  ensuing  year  a  good  body  of  ore  might  have 
been  developed,  on  which  the  mine  would  make  a  lot  of  money.  By  the 
time  the  next  assessment  came  around  this  ore  body  would  have  been 
worked  out,  there  would  be  no  value  in  sight  to  assess,  and  consequently 
the  state  would  have  been  deprived  of  any  revenue  whatever  on  the  ore 
extracted.  This  is  by  no  means  an  uncommon  occurrence  in  our  lode 
mines  out  West. 

I  am  reminded  of  an  incident  I  heard  the  other  day.  A  gentleman 
was  developing  a  mine  in  the  Tintic  Mining  District  of  Utah,  and  during 
a  certain  period  the  mine  did  not  look  very  well,  and  he  was  rather  dis- 
couraged. He  went  to  a  neighbor,  who  had  been  operating  in  the  camp 
for  many  years,  and  said:  "I  have  found  that  the  ore  bodies  of  Tintic 
are  very  irregular.  What  has  been  your  experience?"  The  neighbor 
replied.  "My  experience  has  been  much  the  same,  only  more  so.  Why, 
even  with  my  mine,  which  is  now  paying  big  dividends,  there  have  been 


AMERICAN     MINING     CONGRESS  53 

times  when  I  have  been  worried  to  death,  wondering  where  I  would  get 
ore  enough  to  meet  the  pay  roll.  It  used  to  keep  me  awake  nights.  Well, 
that  condition  would  sometimes  last  for  several  months,  and  then  it 
would  suddenly  get  worse." 

I  apprehend  the  miners  of  Michigan  do  not  have  that  condition  to 
go  up  against.  I  think  so  far  as  the  Western  mines  are  concerned  the 
idea  of  assessments  on  ore  reserves  is  rather  impracticable.  There  are 
a  good  many  mines  that  are  shipping  ore  to  the  smelters  that  never 
have  any  ore  blocked  out.  I  know  of  many  mines  in  Utah  that  take  out 
the  ore  as  fast  as  they  uncover  it,  and  unless  we  are  going  to  assess 
prospective  values  and  guess  at  what  might  be  found  in  the  future — 
which  would  be  a  pretty  risky  method  of  taxation — I  should  think  that 
possibly  there  would  be  less  revenue  to  the  state  from  an  ad  valorem 
tax  than  there  would  be  from  a  tax  upon  net  proceeds. 

In  Utah  our  law  is,  substantially,  to  tax  all  patented  mining  claims. 
Of  course  unpatented  claims  are  not  assessed,  because  they  are  not 
owned  by  the  state,  but  by  the  Federal  government.  And  a  man  who  has 
to  spend  a  hundred  dollars  a  year  in  assessment  work  in  order  to  hold 
his  claim,  and  has  to  raise  money  enough  to  get  it  patented,  would  not 
be  given  a  fair  chance  if  he  had  to  pay  taxes  as  well  as  do  the  assess- 
ment work  each  year.  But  the  patented  mining  claims  are  assessed 
at  the  rate  of  $5  an  acre.  That  is  the  price  that  has  been  paid  to  the 
government,  and  it  is  assumed  that  is  a  fair  price.  As  a  matter  of  fact 
this  is  very  often  more  than  the  land  is  really  worth  for  any  purpose 
that  it  can  be  used  for,  but  as  men  are  willing  to  pay  this  price  for  it, 
the  land  is  presumed  to  be  worth  it.  All  improvements  are  assessed 
under  the  general  property  tax  at  their  fair  value.  And  then  the  net 
proceeds  of  the  mine  are  assessed  also.  I  think  in  Utah  that  law  is  very 
generally  approved.  Sometimes  we  hear  some  criticism  from  the  cow 
counties  that  the  miners  are  not  paying  their  share  of  the  taxes,  but  I 
believe  in  general  the  law  is  very  highly  approved  by  all  classes  of 
citizens.  I  think  the  makers  of  our  constitution  showed  considerable 
wisdom  when  they  framed  our  system  of  assessing  mines. 

SECRETARY  CALLBREATH:  It  seems  to  me  it  is  so  long  after 
the  noon  hour  that  this  discussion  should  be  continued  this  afternoon. 

THE  PRESIDENT:  This  is  such  an  interesting  subject,  and  one 
which  provokes  such  diversified  argument  that  I  think  we  had  better  have 
it  out  this  afternoon. 

Meeting  adjourned. 

TUESDAY,  DECEMBER  8,  1914. 
Afternoon  Session. 

THE  PRESIDENT:     Gentlemen,  I  am  going  to  ask  Dr.  Phillips  to 
take  the  chair  this  afternon  and  preside  at  the  meeting. 
(Dr.  William  B.  Phillips  in  the  chair.) 

CHAIRMAN  PHILLIPS:  The  Secretary  reminds  us  that  the  intro- 
duction of  resolutions  is  the  first  order  of  business.  Are  there  any 
resolutions  to  be  introduced  at  this  time?  The  custom  is  that  the  resolu- 
tions are  to  be  introduced  in  writing,  read  to  the  convention  and  referred 
to  the  Resolutions  Committee  without  debate,  the  debate  to  take  place 
upon  the  report  of  the  Resolutions  Committee  when  that  is  finally  made. 
Are  there  any  resolutions  ready  at  this  time? 

MR.  DERN:  Mr.  Chairman,  I  have  a  resolution  I  would  like  to 
present. 

SECRETARY  CALLBREATH:  This  will  be  Resolution  No.  1,  intro- 
duced by  George  H.  Dern  of  Utah,  and  it  reads  as  follows: 


54  OFFICIAL     PROCEEDINGS 

Resolution  No.  1,  Introduced  by  George  H.  Dern  of  Utah. 

Whereas,  The  welfare  and  prosperity  of  the  States  of  Arizona,  Cali- 
fornia, Colorado,  Idaho,  Michigan,  Montana,  Nevada,  New  Mexico  and 
Utah,  and  of  the  Territory  of  Alaska,  are  to  a  very  great  extent  dependent 
upon  the  mining  industry,  and  especially  upon  the  mining,  milling  and 
smelting  of  the  ores  of  copper,  and  the  mining  of  the  coal  necessary  to 
render  the  handling  of  such  copper  ores  possible;  and 

Whereas,  The  mines  of  the  states  and  the  territory  above  mentioned 
produced  about  1,100,000,000  pounds  of  copper  during  the  year  1913, 
valued,  according  to  government  reports,  at  about  $173,000,000,  to  which 
amount  should  be  added  the  value  of  the  gold  and  silver  contained  in 
said  copper  ores,  worth  at  least  $27,000,000,  making  a  total  value  of 
about  $200,000,000;  and 

Whereas,  There  are  over  100,000  persons  engaged  directly  in  the 
mining,  milling,  smelting  and  transportation  of  copper  ores,  and  in  the 
mining  of  the  coal  used  in  connection  with  the  production  of  said  copper 
ores,  and  about  300,000  people  directly  dependent  upon  those  so  em- 
ployed in  said  industry;  and,  in  addition  thereto,  not  less  than  100,000 
persons  indirectly  dependent  upon  the  industry  for  their  means  of  liveli- 
hood, making  a  total  of  more  than  500,000  people  who  are  affected  by 
the  curtailment  of  the  output  of  copper;  and 

Whereas,  On  account  of  the  war  conditions  now  prevailing,  the  ex- 
portation of  copper  to  European  countries  has  been  greatly  restricted, 
which  has  already  resulted  in  a  curtailment  of  about  50%  in  the  copper 
production  of  said  states,  and  has  caused  hardship  and  suffering  among 
those  connected  with  the  industry;  and 

Whereas,  If  this  calamitous  condition  is  prolonged,  it  will  continue 
to  disastrously  affect  the  entire  population  of  said  states  and  territory, 
or  at  least  8,000,000  people,  and  throw  out  of  employment  many  thousands 
of  persons  who  are  now  dependent  upon  the  said  industries  for  their 
livelihood; 

Now,  Therefore,  Be  it  unanimously  resolved,  by  the  American  Mining 
Congress,  in  Seventeenth  Annual  Convention  assembled  at  Phoenix,  Ari- 
zona, that  in  order  to  prevent  such  great  disaster  to  said  states  and  to 
the  Territory  of  Alaska,  we  earnestly  appeal  to  the  Government  of  the 
United  States  to  use  its  great  offices  to  keep  open  every  available  market 
for  copper  and  give  full  protection  to  the  producers  of  the  metal  in  the 
shipment  of  same  in  neutral  vessels  to  neutral  ports. 

Be  It  Further  Resolved,  That  a  copy  of  this  resolution  be  transmitted 
by  telegraph  to  the  Secretary  of  State  of  the  United  States  of  America. 

CHAIRMAN  PHILLIPS:  It  will  be  referred  without  debate  to  the 
Committee  on  Resolutions.  Are  there  any  other  resolutions  to  be  sub- 
mitted? If  not,  we  will  continue  the  discussion  that  was  interrupted 
at  the  noon  hour. 

SECRETARY  CALLBREATH:  Mr.  Chairman:  A  few  days  ago 
when  it  was  agreed  between  Mr.  Webb  and  Mr.  Clark  as  to  the  form 
of  this  report  I  wrote  to  each  of  the  other  members  of  the  committee 
suggesting  that,  having  had  a  copy  of  the  report  as  then  prepared,  I 
would  like  to  have  them  state  whether  they  would  approve  the  report 
and  allow  their  names  to  be  used  in  connection  with  it,  and  asking  them 
to  wire  me  if  they  had  any  objection,  assuming  that  if  they  had  made  no 
protest  to  the  form  of  the  report  that  they  were  practically  in  accord 
with  its  provisions. 

MR.  WALTER  DOUGLAS:  Mr.  Chairman:  In  view  of  the  fact  that 
the  discussion  on  the  question  of  mine  taxation  has  occupied  perhaps  a 


AMERICAN     MINING     CONGRESS  55 

longer  time  than  had  been  anticipated,  I  move  that  future  remarks  on  the 
subject  be  under  the  five  minute  rule. 

(Motion  seconded  and  carried  unanimously.) 

CHAIRMAN  PHILLIPS:  We  will  be  pleased  to  hear  from  anyone 
on  this  subject  under  the  five  minute  rule. 

MR.  BERN:  Mr.  President,  as  the  matter  is  finally  before  the 
house,  in  line  with  the  remarks  I  made  this  forenoon,  I  move  that  the 
last  paragraph  of  the  report  of  the  Committee  on  Mine  Taxation  be 
stricken  out  and  that  the  remainder  of  the  report  be  adopted  and  de- 
clared by  the  American  Mining  Congress  as  being  the  proper  basis 
for  mine  taxation  in  the  Rocky  Mountain  and  Pacific  Coast  mining 
states. 

CHAIRMAN  PHILLIPS:  Does  that  relate  to  "b"  on  the  fourth 
page? 

MR.  BERN:     Yes. 

(Further  discussion   called  for.) 

(Motion  seconded  and  carried  unanimously.) 

CHAIRMAN  PHILLIPS:  The  next  order  of  business  is  the  report 
on  Mining  Investments,  Chairman,  Hon.  W.  R.  Allen  of  Butte,  Montana. 

SECRETARY  CALLBREATH:  I  am  very  sorry  to  say  that  Mr. 
Allen  is  not  here.  He  fully  expected  to  be  here,  and  we  have  had  no- 
word  from  him  that  he  would  not  be  here.  The  last  word  was  about 
two  weeks  ago  when  he  fully  expected  to  be  here.  This  is  a  very 
important  subject,  and  I  hardly  know  how  we  should  treat  it  in  the 
absence  of  the  report,  but  it  seems  to  me  that  we  ought  not  to  pass  it 
by  without  some  consideration  of  the  means  by  which  we  may  stimulate 
mining  investments  in  the  West  through  the  treatment  of  this  subject. 
I  wish  that  we  might  have  a  discussion  upon  it  in  a  general  way,  not 
only  the  means  of  protecting  mining  investors,  but  the  means  of  secur- 
ing mining  investments,  the  means  of  bringing  to  the  West  the  capital 
it  needs  for  the  development  of  its  mines,  the  means  when  that  capital 
is  brought  to  us  to  see  that  it  is  directed  into  those  channels  where  it 
may  hope  for  success,  and  that  it  may  be  steered  away  from  channels 
of  fraud  and  deception  which  are1  commonly  known  to  mining  men,  that 
the  West  may  profit  by  the  development  of  its  enterprises,  that  the 
East  and  the  whole  world  may  profit  by  the  increase  in  gold  which  is 
so  necessary  in  our  world  commerce.  It  seems  to  me  there  is  so- 
much  that  can  be  worked  out  through  an  effort  of  this  kind  that  we 
ought  not  to  pass  it  by  merely  because  the  chairman  of  the  committee 
has  failed  to  make  his  report.  I  might  say  while  I  am  on  my  feet  that 
there  is  great  agitation  in  this  country  as  to  how  we  may  assume  control 
of  the  trade  of  South  America,  which  ought  to  come  to  this  country. 
Heretofore,  as  most  of  you  know,  the  South  American  trade  has  been 
largely  controlled  by  European  countries.  It  has  been  much  more  diffi- 
cult for  us  to  get  from  this  country  to  South  American  ports,  very  much 
more  difficult,  than  it  was  for  European  nations.  Ordinarily,  in  order 
to  get  to  those  ports  we  have  gone  first  to  London  and  then  back  across 
the  ocean  to  South  America.  The  channels  of  trade  heretofore  have 
been  altogether  towards  Europe  from  the  South  American  countries. 
Now  that  trade  relation  has  been,  to  a  large  extent,  cut  off.  The  South 
American  people  want  to  patronize  us.  We  have  the  goods  and  the 
ability  to  sell  them  if  they  had  the  money  to  buy;  but  in  connection  with 
the  European  control  of  this  trade  they  have  furnished  the  credit  which 
has  enabled  the  South  American  people  to  do  business.  Our  Eastern 
economists  have  talked  much  about  the  great  opportunity  which  has 
been  given  the  United  States  to  reach  after  and  control  this  trade,  but 
they  have  stopped  short  at  the  point  where  they  found  that  we  were 


56  OFFICIAL    PROCEEDINGS 

unable  to  extend  the  credits  which  are  necessary  to  handle  that  trade. 
The  reason  we  cannot  do  it  is  because  we  haven't  moi^ey  enough  in  this 
country  to  take  care  of  their  business  as  well  as  our  own.  A  certain 
amount  of  credit  is  necessary  in  all  business  transactions,  but  when 
the  burden  of  credit  upon  gold  is  too  great  the  structure  falls  and 
breaks  to  pieces.  We  have  about  reached  the  limit  of  credit  that  can 
be  based  upon  our  gold  supply.  In  order  to  extend  and  care  for  the 
credits  which  are  necessary  to  control  South  American  trade  we  need 
an  increase  in  our  gold  supply.  It  seems  to  me  this  Congress  ought  to 
be  able  to  work  out  some  plan  by  which  we  may  better  stimulate  the 
production  of  gold  in  the  West.  If  we  do  that  we  will  serve  the  West, 
we  will  serve  the  country,  and  we  will  create  a  new  channel  for  our 
manufacturing  industries.  Whenever  one  business  prospers,  in  this 
country,  every  other  business  must,  to  an  extent,  prosper  with  it,  I 
hope  this  Congress  will  discuss  this  subject  to  see  whether  or  not  we 
may  arrive  at  some  plan  by  which  the  produciton  of  gold  in  the  Western 
states  may  be  stimulated.  (Applause.) 

CHAIRMAN  PHILLIPS:     Is  there  a  gold  miner  in  this  convention? 

MR.  HARRY  J.  BENTON,  of  Arizona:  Mr.  Chairman,  I  cannot 
understand  why  this  convention  has  been  called.  It  has  simply  been 
called,  as  I  understand,  not  to  help  the  poor  miner,  the  gold  producer, 
the  prospector.  I  am  not  speaking  for  myself  alone,  but  I  know  of  a 
great  many  miners  who  have  rich  gold  properties  in  our  beautiful  state 
of  Arizona  yet  they  have  not  the  money  to  develop  those  properties. 
They  have  got  ten,  twelve,  fifteen — in  fact  I  personally  have  shipped 
ore  that  went  $59.39  to  the  ton  to  the  Copper  Queen  smelter.  After 
mining,  came  transportation  on  this  ore,  and  the  settlement  I  received 
left  me  $14.19.  Can  a  gold  miner  produce  any  gold  in  our  beautiful  state 
of  Arizona,  or  any  other  state,  with  these  exorbitant  prices  for  railroad 
transportation  and  smelting,  when  they  dock  you  for  the  silica,  when 
they  say  you  have  not  enough  silica,  or  too  much  moisture,  or  not 
enough  moisture,  and  one  thing  and  another  all  the  way  through?  If 
you  are  mining  men  here  and  have  ever  been  10  or  20  or  30  or  50  feet 
underground  you  understand  many  of  these  things.  You  cannot  ship 
ore  in  the  state  of  Arizona  if  it  goes  less  than  $35  to  $40  a  ton.  Talk 
about  your  gold,  you  can't  do  a  thing  with  it.  I  have  35  tons  of  ore 
blocked  out  in  a  mine.  I  have  got  22  claims  with  over  3,000  feet  of 
work  done  on  my  property.  What  can  I  do  with  the  ore.  Nothing.  I 
dannot  ship  it  to  the  smelter.  I  am  broke.  A  mining  man  without 
capital  cannot  do  it.  I  know  when  the  United  Verde  mine  could  have 
been  bought  for  $300.  Tom  Brady  could  have  bought  your  Copper  Queen 
mine  for  $7,000.  You  don't  know  these  things,  but  I  do.  These  are 
millionaire  miners,  but  where  is  the  poor  miner  going  to  get  off?  Where 
is  your  proposition?  Here  is  another  thing  I  want  to  illustrate  to  you 
gentlemen.  Here  is  a  prospector  that  goes  out  and  looks  for  mining 
claims.  He  thinks  they  are  worth  while.  He  will  go  and  put  his 
good  money  in  there  and  put  down  his  prospect  hole,  and  the  next  year 
he  comes  along  and  he  has  to  put  a  hundred  dollars  on  each  one  of  four 
or  five  claims.  Has  he  the  money?  I  want  to  say  to  you  gentlemen  there 
is  not  a  mining  man  here  except  millionaire  miners,  that  ever  did  his 
legitimate  assessment  work  every  year  according  to  what  the  law  re- 
quires. The  law  says  you  have  to  put  a  hundred  dollars  on  each  claim. 
Show  me  a  prospector  here.  And  if  he  has  ten  claims,  where  will  he 
dig  up  that  thousand  dollars  a  year  to  do  that  work  These  are  facts. 
I  want  to  say  to  you  gentlemen  there  is  not  a  mining  man  in  the  state 
of  Arizona  that  has  forty-dollar  rock  who  can  ship  that  ore.  You  can't 
mill  it  unless  you  have  the  mill,  and  if  you  can't  mill  it  you  can't  ship 
it,  and  your  railroads  and  smelters  take  the  whole  of  your  profit,  and 
when  you  get  through  you  cannot  buy  a  side  of  bacon  or  a  sack  of  beans. 
These  are  my  sentiments,  gentlemen. 


AMERICAN     MINING     CONGRESS  57 

MR.  BASS:  Mr.  Chairman,  I  don't  know  who  the  gentleman  is  who 
has  just  made  that  speech,  but  I  will  wager  that  he  is  a  miner.  I  have 
had  a  little  experience  of  that  kind  myself.  Now,  I  am  mining  in  the 
biggest  hole  in  the  earth.  I  didn't  dig  it  myself;  it  is  the  Grand  Canyon. 
But  I  know  this,  that  by  the  time  I  get  my  ore  on  the  top  and  get  it  over 
to  the  railroad  I  can't  ship  it,  because  I  couldn't  really  get  enough  money 
out  of  it  to  pay  the  freight,  and  yet  I  have  the  highest  grade  ore  in 
Coconino  county,  and  asbestos,  too — some  of  you  may  need  it  in  the 
future  if  you  have  no  use  for  it  now.  But  I  cannot  ship  it  because  the 
freight  is  too  high.  We  can  ship  it  down  to  the  smelters  here  anywhere, 
almost,  even  to  El  Paso,  for  a  very  nominal  rate,  90  cents  a  ton  I  believe 
they  charge  from  the  Grand  Canyon  over  their  road  to  the  smelter  in 
Yavapai  county.  I  have  a  car  of  ore  lying  there,  and  when  I  got  ready  to 
ship  it,  of  course,  about  the  time  I  was  ready  copper  went  down,  and  it 
lays  there  yet.  I  know  a  man  up  there  that  shipped  a  carload  of  ore,  and 
when  he  received  his  returns  he  didn't  get  enough  to  pay  his  expenses, 
and  he  paid  his  transportation  and  quit.  Now,  they  take  the  smelter 
returns,  and  by  the  time  they  get  through  with  the  moisture  and  silica 
and  all  that  stuff  we  are  all  in  debt,  so  we  quit.  Why  is  it  that  they 
can  ship  that  fluxing  ore  for  20  cents  a  ton  and  we  have  to  pay  $7.  I 
don't  understand  it.  And  there  is  where  your  trouble  is.  That  is  what 
stops  your  mining.  You  can't  do  it.  There  is  no  use  in  talking,  you 
go  in  debt  if  you  undertake  it.  Now,  my  ore  carries  well  in  gold.  I 
have  the  original  forms  of  copper  away  down  in  the  Grand  Canyon, 
and  when  I  get  it  up  there  of  course  I  can't  get  capital  to  help  me.  I 
am  nothing  but  a  prospector,  but  I  have  spent  thousands  of  dollars,  I 
have  hundreds  of  tons  on  original  fissure  veins,  in  schist,  and  anybody 
that  has  ever  mined  copper  knows  that  schist  is  the  home  of  copper, 
and  if  we  could  go  down  there  and  develop  it  we  would  have  another 
United  Verde,  and  I  have  the  pleasure  of  knowing  all  about  the  United 
Verde.  But  the  great  trouble  is  this:  They  take  their  smelter  returns, 
and  if  they  leave  you  enough  to  buy  a  sack  of  beans  you  are  mighty 
lucky.  Now,  if  I  ship  lumber  over  our  road  I  can  ship  a  car  of  good 
lumber  for  the  same  price  I  can  ship  culls.  They  don't  charge  any 
more  to  ship  mahogany  than  they  do  for  culls;  but  when  it  comes  to 
ore  it  is  a  different  proposition.  There  is  where  the  trouble  is.  Now, 
I  wanted  to  say  something  on  this  taxation  question.  My  five  minutes 
isn't  up,  is  it? 

CHAIRMAN  PHILLIPS:     We  are  not  under  the  five-minute  rule. 

MR.  BASS:  And  that  is  this — that  if  we  expect  to  get  capital  to 
come  into  our  mines  in  Arizona  we  must  stop  this  bogus  mining  loca- 
tion, that  is,  the  location  of  bogus  mines — speculative  locations — loca- 
ting mines  under  the  mineral  laws  and  holding  them  for  speculation. 
We  have  seven  miles  of  it  right  up  where  I  live,  and  if  I  should  under- 
take to  talk  about  getting  some  capital  down  in  the  Grand  Canyon  they 
would  laugh  at  me,  because  they  have  been  hornswoggled  too  much  on 
bogus  mining  claims.  If  we  could  stop  that  we  would  do  a  good  thing. 
Then  when  we  get  people  to  go  down  where  God  Almighty  has  opened 
up  the  earth  we  can  show  them  something  better  than  can  be  found  in 
any  other  place  in  the  state  of  Arizona,  and  I  venture  to  say  that  I 
will  show  you  that  we  have  conditions  existing  there  that  will  make  it 
possible  to  get  capital  to  come  in  there.  You  take  the  last  map  just 
issued  by  the  Geological  Survey  of  the  United  States;  it  shows  it  is 
there,  but  we  can't  get  the  capital.  It  is  impossible.  But  if  you  could 
put  taxation  on  some  of  these  bogus  claims  so  that  they  couldn't  afford 
to  hold  them  without  development  they  would  turn  them  loose  and  we 
would  get  people  in  there  who  would  put  money  into  real  mines.  They 
go  back  East  and  raise  money  on  options,  and  the  people  come  out  and 
spend  $5,000  or  $6.000  and  throw  the  matter  up  and  go  back  and  say, 
"You  haven't  any  mines." 


58  OFFICIAL     PROCEEDINGS 

MR.  UTTER:  Mr.  President,  I  think  we  have  a  remedy  for  the 
trouble  stated  by  our  Arizona  brother  in  some  of  the  matters  that  have 
been  mentioned.  If  they  will  all  remove  to  New  Mexico  I  can  assure 
them  fair  railroad  rates  and  fair  smelter  charges;  and  then  in  New 
Mexico  we  can  ship  ores  up  to  the  value  of  $50  a  ton  for  a  dollar  a 
ton  freight.  We  have  a  smelting  charge  of  $5  to  $6,  and  those  are  mat- 
ters that  are  of  vital  importance.  Some  of  those,  and  most  of  them 
I  think  make  a  graduated  freight  charge,  and  that  is  worthy  of  consider- 
ation, so  that  if  our  Arizona  brothers  will  just  step  over  the  line  their 
troubles  will  be  over,  I  think.  (Laughter  and  applause.) 

MR.  BASS:  I  would  hate  to  have  to  move  to  New  Mexico  while  I 
am  in  office.  (Laughter.) 

CHAIRMAN  PHILLIPS:     Any  further  discussion  on  this  subject? 

MR.  BENTON:  Mr.  President  and  Gentlemen:  Why  is  it  when 
you  ship  a  carload  of  cobblestones  you  pay  so  much  freight  on  it,  but  it' 
you  ship  a  carload  of  gold  rock  the  higher  the  gold  contents  the  higher 
your  freight  rate  will  be?  Does  it  cost  any  more  to  haul  a  carload  of 
cobblestones  than  a  carload  of  ore?  A  ton  is  a  ton,  whether  it  is  cobble- 
stones or  gold  rock;  yet  you  ship  a  carload  of  gold  rock,  and  what  is 
the  result?  If  it  goes  $12  to  the  ton  you  are  taxed  maybe  $8  freight, 
and  if  it  goes  $50  you  are  taxed  $14.  Where  does  the  difference  come  in? 
We  are  here  in  this  convention  to  right  these  things,  and  I  pray  to  God 
that  you  will  stand  up  and  do  these  things  like  men,  like  American 
citizens,  and  stand  by  the  poor  miner  who  produces.  The  man  who 
takes  these  values  out  of  the  ground  robs  nobody;  he  goes  out  in  the 
hills  all  by  his  lonesomeness;  for  days  and  weeks  he  is  out  in  the  hills 
by  himself  and  his  burro,  and  sometimes  he  has  no  burro,  and  he  has 
to  live  on  a  sack  of  beans  that  he  has  packed.  And  finally  he  finds  the 
precious  metal  that  everybody  loves  and  everybody  grasps  and  wants. 
What  does  he  get  out  of  it?  Not  a  dime.  The  other  fellow  comes  in 
with  the  capital  and  says,  "Oh,  well,  I  will  give  you  a  hundred  dollars." 
The  poor  fellow  is  nearly  starved.  What  is  he  going  to  do?  He  takes 
that  hundred  dollars,  and  the  other  fellow  makes  millions  out  of  it,  and 
then  they  will  tell  you,  "We  are  the  mining  men."  My  first  experience 
in  mines  was  in  Leadville,  Colorado,  in  1878.  I  know  the  game  all  the 
way  through,  and  I  went  broke  and  am  broke  today.  I  tell  you  right 
here,  gentlemen,  I  am  a  stayer,  though;  I  mortgaged  my  home,  even 
the  bed  and  the  carpets  that  my  dear  wife  walks  on,  and  put  it  in  my 
mines,  because  my  wife  has  faith  in  them.  Understand  me?  I  am  a 
stayer.  I  am  a  miner.  (Applause.) 

CHAIRMAN  PHILLIPS:  Any  further  discussion  of  this  matter? 
If  not,  we  will  pass  to  the  next  paper,  which  is  on  Mining  Development, 
by  Mr.  E.  G.  Reinert  of  Denver. 

Mr.  Reinert's  paper  will  be  found  at  page  193  of  this  report. 

CHAIRMAN  PHILLIPS:  The  next  paper  on  the  program  is  a 
paper  by  George  Otis  Smith,  Director  of  the  United  States  Geological 
Survey,  entitled  "Why  Optimism." 

SECRETARY  CALLBREATH:  I  am  in  receipt  of  this  letter  in  con- 
nection with  Dr.  Smith's  paper: 

Washington,  November  28,  1914. 
Mr.  J.  F.  Callbreath,  Board  of  Trade  Building,  Phoenix,  Arizona: 

My  Dear  Mr.  Callbreath — I  am  very  sorry  to  have  to  advise  you  that 
it  will  not  be  possible  for  me  to  attend  the  Phoenix  Congress.  I  had 
had  every  expectation  of  being  with  you  until  after  a  final  conference 
with  Secretary  Lane  regarding  the  trip  West  which  I  had  planned.  He 
and  I  agreed  that  my  absence  from  Washington  at  this  time  was  out  of 


AMERICAN     MINING     CONGRESS  59 

the  question.  Congress  will  be  in  session  here  during  the  time  that  I 
would  be  in  the  West  and  appointments  have  already  been  made  for 
hearings  before  the  Senate  Public  Lands  Committee,  the  first  of  which 
falls  on  December  9.  I  have,  however,  been  working  evenings  on  the 
address  which  I  expected  to  deliver  and  I  take  some  little  pleasure  in 
rncjosing  it.  Since  my  idea  has  been  to  strike  a  note  that  might  be 
encouraging  to  some  of  the  mining  men  in  attendance  on  the  Congress, 
I  hope  that  possibly  you  can  arrange  to  have  it  read  as  scheduled.  In 
the  event  that  you  follow  the  plan  of  other  years  and  print  some  of  the 
papers  for  distribution  at  the  Congress,  I  should  be  perfectly  willing  to 
have  charged  to  me  some  of  the  expense  in  connection  with  my  paper 
and  I  should  appreciate  receiving  a  hundred  copies  or  so. 

On  page  4  you  will  find  the  omission  of  two  numbers,  the  figures 
for  which  will  not  be  available  until  after  the  first  of  the  month  when  I 
will  transmit  them  to  you,  by  wire  if  necessary.  The  only  actual  omis- 
sion is  after  the  words  "fourth  week  by."  The  second  space  may  be 
filled  by  simply  adding  the  figures  for  the  four  separate  weeks  of  the 
month. 

Please  present  my  regrets  at  not  being  able  to  attend  the  Congress 
to  any  inquiring  friends  and  with  best  wishes  for  the  success  of  the 
Phoenix  meeting,  believe  me. 

Yours  very  cordially, 

GEORGE  OTIS  SMITH,  Director. 

SECRETARY  CALLBREATH:     The  paper  is  here,  Mr.  Chairman. 

CHAIRMAN  PHILLIPS:  Gentlemen,  is  it  your  pleasure  that  this 
paper  be  read?  The  Secretary  will  please  read  the  paper. 

SECRETARY  CALLBREATH:     May  we  have  a  volunteer? 

MR.  F.  L.  RANSOME,  Washington,  D.  C.:  As  I  suppose  I  am  the 
only  member  of  the  Geological  Survey  here,  I  shall  be  pleased  to  read 
the  paper  if  it  is  desired. 

Dr.  Smith's  paper  will  be  found  at  page  217  of  this  report. 

CHAIRMAN  PHILLIPS:  I  understand  the  paper  entitled  "The 
Needs  of  the  Zinc  Mining  Industry,"  by  Mr.  Otto  Ruhl,  is  not  here. 

The  Secretary  has  received  some  communications  to  be  presented  to 
the  Congress. 

New  York,  December  9,  1914. 
J.  F.  Callbreath,  Secretary  American  Mining  Congress,  Phoenix: 

Greatly  regret  it  will  be  impossible  for  me  to  attend  Congress. 
Wishing  you  successful  meeting  and  envying  you  the  opportunity  of 
spending  a  few  days  in  a  delightful  climate  among  congenial  friends,  I 
am,  with  best  wishes,  JOHN  HAYS  HAMMOND. 

San  Francisco,  Cal.,  Dec.  1,  1914. 
Mr.  J.  F.  Callbreath,  Jr.,  Secretary  American  Mining  Congress,  Denver, 

Colorado: 

Dear  Callbreath — I  am  very  sorry  indeed  that  it  will  be  impossible 
for  me  to  attend  the  meeting  of  the  Congress  this  year.  I  have  wanted 
very  much  to  get  down  there  and  meet  you  and  my  other  friends,  and 
this  desire  is  all  the  stronger  since  I  see  the  very  attractive  program 
that  has  been  laid  out.  I  really  feel  though,  that  with  the  pressure  of 
many  things  I  cannot  spare  the  time  to  make  the  trip.  Please  express 
my  regrets  to  any  friends  who  may  inquire. 

With  best  wishes  for  the  meeting,  I  am, 

Cordially  yours,  H.   FOSTER   BAIN. 


60  OFFICIAL     PROCEEDINGS 

Denver,  Colo.,  December  7,  1914. 
American  Mining  Congress,  Phoenix,  Arizona: 

Congratulations  upon  the  completion  of  your  seventeenth  year  of 
activity  in  behalf  of  mining.  Please  accept  regrets  for  my  inability  to 
appear  in  person  upon  your  program.  Am  sure  your  gathering  will  be 
a  momentous  one.  Upon  question  of  mining  investments,  there  will  be 
none  to  discuss  if  agents  of  the  government  are  permitted  to  restrict 
the  generous  development  of  the  West,  thus  shutting  off  the  ambitions 
of  both  Eastern  and  Western  citizens  who  desire  to  participate  in  the 
creation  of  Western  industries  upon  the  public  lands.  We  are  for  con- 
structive, not  destructive  conservation.  Please  smash  the  destroyers  for 
us.  EDWARD  G.  REINERT. 

Chicago,  111.,  December  8,  1914. 
James  F.  Callbreath,  Phoenix: 

Congratulations  to  the  Congress.  Mining  men  should  be  interested 
in  establishing  proper  credit  for  their  securities  and  some  form  of  pro- 
tection for  the  investor,  that  they  could  not  be  discriminated  against  on 
account  of  making  such  investments.  Financiers  know  that  prosperity 
depends  on  operators  of  mines  and  the  soil.  J.  F.  ERISMAN. 

New  York.  December  7,  1914. 
J.  F.  Callbreath,  care  Mining  Congress,  Phoeniz,  Arizona: 

At  last  moment  find  it  impossible  to  attend  convention.  Unfinished 
business  here  prevents  my  leaving.  I  assure  you  it  is  a  disappointment 
to  me  that  I  am  not  privileged  to  meet  with  you  and  take  part  in  the 
affairs  of  the  Congress,  though  I  trust  my  absence  may  not  detract  in  the 
least  from  the  success  of  the  meeting.  E.  A.  MONTGOMERY. 

Columbus,  Ohio,  December  4,  1914. 

Mr.  J.  F.  Callbreath,  Secretary  the  American  Mining  Congress,  Denver, 
Colorado : 

Dear  Sir — I  am  very  sorry  to  have  to  advise  that  it  will  be  impossible 
for  me  to  get  away  to  attend  the  meeting  of  your  honorable  body.  I  had 
built  up  fond  hopes  that  I  would  be  in  shape  to  attend  this  meeting,  but 
owing  to  some  difficulties  that  we  have  been  contending  with  in  some  of 
the  mining  propositions  here  at  home,  I  feel  that  I  would  be  doing  an 
injustice  tp  the  state  by  leaving  at  the  present  time. 

Hoping  that  your  meeting  will  be  a  success  and  that  everything  will 
go  well  with  you  and  wishing  you  all  the  best  of  good  luck,  I  am, 
Very  truly  yours,  J.  M.  ROAN, 

Chief   Deputy  and   Safety   Commissioner  of   Mines. 

Bisbee,   Ariz.,   December   4,   1914. 
To  the  Delegates  to  the  American  Mining  Congress,  Greeting: 

We,  the  directors  of  the  Warren  District  Commercial  Club,  for  and 
on  behalf  of  the  business  men  and  residents  of  Bisbee  and  the  Warren 
District,  the  greatest  copper  producing  district  in  the  Southwest,  do 
extend  to  you  a  cordial  invitation  to  visit  Bisbee  and  the  mines  of  the 
Warren  Mining  District  during  your  stay  in  Arizona,  and  assure  you 
of  a  hearty  welcome  here  as  well  as  an  experience  which  must  prove 
interesting  and  highly  instructive. 

We  regret  that  it  has  been  found  impossible  to  have  the  railroads 
run  a  special  excursion  train  here,  but  all  who  travel  over  the  Rock 
Island  and  the  El  Paso  &  Southwestern  roads  have  stop-over  privileges 
and  the  railroads  have  stated  that  they  will  make  a  special  party  rate 
from  Phoenix  to  Bisbee  of  a  single  fare  plus  one-third  for  the  round 
trip  to  parties  of  15  or  more.  Information  relative  to  the  formation  of 


AMERICAN     MINING     CONGRESS  61 

such  parties  may  be  obtained  from  the  delegates  from  this  club,  this 
city  and  Cochise  county  or  by  application  to  the  local  ticket  agents  in 
Phoenix. 

It  is  our  sincere  hope  that  many  of  you  will  take  advantage  of  this 
rate  and  the  opportunity  to  visit  this   wonderfully  mineralized  district 
that  produces  more  than  one-third  of  the  copper  that  is  taken  from  the 
earth  in  Arizona  as  well  as  a  large  proportion  of  the  gold,  silver  and  lead. 
Again  assuring  you  of  our  desire  to  meet  you  here  and  of  a  cordial 
welcome  when  you  arrive,  we  remain, 
Yours  very  truly, 

J.    J.    BOWEN, 

M.  NEWMAN, 

M.  J.   CUNNINGHAM, 

E.   C.   CAMPBELL, 

E     W.    BEDDOW, 

GEO.    L.    DAVIDSON, 

L.    J.    OVERLOCK, 

JESSE  YOAKUM, 

H.   B.  HUNTER, 

JOSEPH  H.  GRAY,  Secretary, 

Directors. 

MR.  GERALD  SHERMAN:  Mr.  President,  I  have  the  honor  of  be- 
ing a  delegate  from  the  Bisbee  Board  of  Trade,  and  I  wish  to  confirm 
their  invitation  and  assure  any  of  the  members  who  might  be  able  to 
come  that  they  will  be  taken  care  of  and  that  every  possible  effort  will 
be  made  to  show  them  what  is  there  and  to  make  their  visit  a  pleasant 
one. 

SECRETARY  CALLBREATH:  I  have  a  communication  from  Mr. 
I.  C.  Thoreson,  United  States  Surveyor  General  of  Utah. 

CHAIRMAN  PHILLIPS:  Is  it  the  desire  of  the  convention  to  hear 
the  paper  read? 

(Reading  called  for.) 

Mr.  Thoreson's  paper  will  be  found  at  page  190  of  this  report. 

MR.  UTTER:  Mr.  President,  I  move  that  paper  be  filed  and  that 
the  Committee  on  Resolutions  may  be  asked  to  formulate  a  resolution 
or  recommendation  to  be  presented  to  this  Congress  and  passed  and 
possibly  forwarded  to  our  lawmakers  or  the  authorities  in  Washington. 
This  is  in  the  interest  of  the  poor  miner. 

(Motion  seconded  and  carried  unanimously.) 

CHAIRMAN  PHILLIPS:  Gentlemen,  I  am  sure  that  such  of  you  as 
are  able  to  make  the  trip  to  Bisbee  will  find  it  both  profitable  and  pleas- 
ant, and  it  is  to  be  hoped  that  some  of  you  will  be  able  to  accept  the 
very  kind  invitation  issued  by  the  people  there.  I  wish  my  plans  were 
such  that  I  could  accept  it,  because  I  remember  some  very  pleasant 
days  spent  at  Bisbee  some  years  ago.  Is  there  any  further  business  to 
come  before  the  convention  this  afternoon?  We  have  reached  the  end 
of  our  program.  If  not,  the  Congress  will  now  stand  adjourned  until 
7 : 30  o'clock  this  evening. 

WEDNESDAY,  DECEMBER  9,  1914. 
Morning  Session,  9:30  O'clock  A.  M. 
(President  Scholz  in  the  chair.) 

THE  PRESIDENT:  Gentlemen,  you  will  please  come  to  order.  The 
first  thing  on  the  program  this  morning  will  be  the  introduction  of  reso- 
lutions. Has  the  Committee  on  Resolutions  anything  to  bring  forward? 


62  OFFICIAL     PROCEEDINGS 

MR.  REES  H.  BEDDOW:  Mr.  President  and  Gentlemen:  On  behalt 
of  the  Resolution  Committee  I  beg  to  report  Resolution  No.  1,  introduced 
by  Mr.  George  Dern  of  Utah,  with  the  recommendation  of  the  committee 
that  same  be  adopted. 

I  move  that  the  same  be  adopted  by  the  Congress. 

(Motion  seconded  and  carried  unanimously.) 

THE  PRESIDENT:  Are  there  any  further  resolutions  to  be  in- 
troduced this  morning? 

MR.  BEDDOW:  Mr.  President,  I  have  a  copy  of  a  bill  in  my  pocket 
that  is  pending  before  Congress,  and  it  has  been  sent  down  here  from 
New  Mexico  with  a  request  that  this  Congress  take  some  action  upon  it. 
I  am  not  familiar  with  the  matter  referred  to  in  this  bill  and  don't  want 
to  assume  any  responsibility  for  its  introduction  before  the  Congress, 
but  if  it  is  thought  proper  I  can  bring  it  forward  and  it  can  be  read 
and  you  may  take  such  action  as  you  deem  proper. 

THE  PRESIDENT:  Has  the  Resolutions  Committee  passed  upon 
that  bill? 

MR.  BEDDOW:  The  bill  was  presented  to  the  committee  yester- 
day, but  they  thought  it  would  be  the  proper  thing  to  bring  it  before  the 
Congress. 

THE  PRESIDENT:  If  it  meets  with  the  approval  of  the  delegates, 
I  would  suggest  that  the  bill  be  read  and  be  submitted  to  a  vote  of  the 
Congress  after  it  has  been  read. 

The  bill  was  read  by  the  Secretary,  and  is  as  follows : 

In  the  House  of  Representatives. — H.   R.   18519. 

August  25,  1914,  Mr.  Fergusson  introduced  the  following  bill,  which 
was  referred  to  the  Committee  on  Public  Lands  and  ordered  to  be 
printed : 

A  BILL  to  amend  section  2324  of  the  Revised  Statutes  of  the  United 
States,  relating  to  mining  claims. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the 
United  States  of  America  in  Congress  assembled:  That  the  provisions 
of  Section  2324  of  the  Revised  Statutes  of  the  United  States,  which  re- 
quire that  on  each  claim  located  after  the  10th  day  of  May,  1872,  and 
until  patent  has  been  issued  therefor,  not  less  than  $100  worth  of  labor 
shall  be  performed  or  improvements  made  during  each  year,  be  suspended 
for  the  year  1914,  so  that  no  mining  claim  which  has  been  regularly 
located  and  recorded  as  required  by  the  local  laws  and  mining  regula- 
tions shall  be  subject  to  forfeiture  for  nonperformance  of  the  annual  as- 
sessment for  the  year  1914;  provided,  that  the  claimant  or  claimants 
of  any  mining  location,  in  order  to  secure  the  benefits  of  this  act,  shall 
cause  to  be  recorded  in  the  office  where  the  location  notice  or  certificate 
is  filed  on  or  before  December  31,  1914,  a  notice  that  he  or  they  in 
good  faith  intend  to  hold  and  work  said  claim;  provided,  however,  that 
the  provisions  of  this  act  shall  not  apply  to  the  state  of  South  Dakota. 

Section  2.  That  this  act  shall  take  effect  from  and  after  its  pas- 
sage. 

THE  PRESIDENT:  Gentlemen,  you  have  heard  the  bill  read;  is 
there  any  discussion  on  the  subject? 

MR.  BEDDOW:  Mr.  President,  the  only  information  I  have  got  in 
regard  to  this  bill  is  this — that  the  matter  was  first  brought  up  before 
the  State  Republican  Convention  of  New  Mexico  in  August.  Resolu- 
tions were  passed  at  that  convention  requesting  Congressman  Fergusson 


AMERICAN     MINING     CONGRESS  63 

to  introduce  this  bill  in  Congress,  and  as  I  said  before,  I  know  nothing 
about  the  merits  of  the  bill,  because  I  am  not  familiar  with  the  condi- 
tions down  there  in  New  Mexico  where  it  is  supposed  to  benefit  quite 
a  number  of  claim  holders.  The  statement  made  before  the  Democratic 
State  Convention,  to  which  it  was  also  presented,  was  that  there  were 
a  large  number  of  claim  holders  in  Grant  and  Sierra  Counties,  New  Mex- 
ico, that  had  been  working  their  claims  for  a  number  of  years  and  that 
when  they  were  not  working  their  own  claims  they  were  working  in  other 
mines  there  for  wages,  and  on  account  of  the  war,  the  men  had  been 
thrown  out  of  work,  and  that  they  had  no  money  to  do  their  assess- 
ment work  with.  Now,  that  is  the  extent  of  my  information  in  regard  to 
this  bill.  You  gentlemen  probably  know  more  about  it  than  I  do. 

MR.  BERN:  I  move  that  the  matter  be  referred  to  the  Committee 
on  Resolutions. 

(Motion  seconded  and  carried  unanimously.) 

THE  PRESIDENT:  Are  there  any  other  resolutions  to  be  pre- 
sented to  the  Congress?  If  there  are  no  more  resolutions,  we  will  pro- 
ceed with  the  regular  program;  but  before  going  ahead  with  the  busi- 
ness session  I  would  like  to  say  to  those  delegates  who  came  in  after 
our  first  session  that  we  are  very  cordially  welcomed  by  the  people  of 
Phoenix;  we  had  the  former  governor,  the  present  governor,  the  mayor 
of  the  city  and  others  to  welcome  us  and  to  extend  to  us  the  hospitality 
of  this  town  and  state.  The  only  reason  we  didn't  have  a  king  here  is 
because  under  our  constitution  we  haven't  any,  but  even  the  policeman 
on  the  corner  welcomed  me  this  morning  when  I  took  my  early  walk. 
I  don't  think  you  appreciate  how  considerate  these  people  are  of  us. 
You  will  notice  the  footlights  on  the  stage  are  red  so  that  you  can  not 
see  the  blush  of  the  chairman  when!  occasions  arise  to  make  him  blush. 
I  sat  in  the  front  row  yesterday  when  Mr.  Phillips  occupied  the  chair, 
and  a  gentleman  in  the  back  asked  him  what  he  knew  about  mining,  and 
Dr.  Phillips  admitted  to  himself  that  he  didn't  know  much  about  it.  I 
wondered  why  he  didn't  blush,  but  I  now  know  the  clause — the  reflec- 
tion from  the  footlights  prevent  your  seeing  the  exact  condition  of  the 
chairman  behind  this  table. 

When  the  local  committee  discovered  that  the  chairman  had  cold 
feet  they  provided  gas  stoves,  and  many  similar  things,  for  which  we 
are  duly  thankful.  One  of  the  things  I  have  observed  is  that  every 
time  I  leave  this  room  (I  am  generally  the  last  one  out  the  door,  be- 
cause the  distance  is  greatest)  some  resident  who  owns  an  automobile 
lingers  and  takes  me  to  the  hotel.  I  don't  know  what  the  purpose  is, 
but  I  think  he*  is  afraid  someone  might  sell  me  a  slice  of  desert  as  a 
farm  or  fake  mining  claim.  At  any  rate,  I  have  been  very  well  taken 
care  of,  and  I  am  sure  the  delegates  have  all  had  the  same  experience. 
We  are  very  grateful  for  the  hospitalities  extended  to  us. 

Next  on  the  program  is  the  report  of  the  Committee  on  Prevention 
of  Mine  Accidents,  by  Dr.  W.  R.  Ingalls. 

SECRETARY  CALL.BREATH:  This  is  not  in  the  form  of  a  report, 
but  in  the  form  of  a  personal  letter  in  response  to  my  request  for  a 
report: 

Report  of  Committee  on    Mine   Accidents. 

Hill  Bldg.,  10th  Ave.  at  36th  St.,  New  York,  N.  Y. 
James  F.  Callbreath,  Esq.,  Munsey  Bldg.,  Washington,  D.   C.: 

My  Dear  Mr.  Callbreath — In  response  to  your  request  for  a  state- 
ment respecting  the  work  of  the  Committee  on  the  Prevention  of  Mine 
Accidents,  whereof  I  am  chairman,  which  committee  was  originally  ap- 
pointed by  the  American  Mining  Congress,  and  later  became  a  committee 


64  OFFICIAL     PROCEEDINGS 

of  the   United   States   Bureau   of  Mines,  I  have  the   permission   of   the 
Director  of  the  Bureau  to  inform  you  as  follows: 

The  committee,  having  made  several  preliminary  reports,  has  al- 
ways eoitertained  the  idea  of  preparing  a  final  draft  for  a  model  law, 
profiting  by  the  comments  made  upon  its  earlier  work.  As  things  pro- 
gressed, however,  it  developed  that  the  studies  that  were  involved  were 
beyond  the  means  of  the  members  of  the  committee  unassisted.  Conse- 
quently Dr.  Joseph  A.  Holmes,  Director  U.  S.  Bureau  of  Mines,  invited 
the  committee  to  serve  as  a  committee  of  the  bureau.  His  invitation 
was  welcomed  and  accepted.  It  was  fully  appreciated,  moreover,  that 
the  United  States  Bureau  of  Mines  was  in  the  best  position  to  see  that 
whatever  report  might  finally  be  made  by  the  committee  should  be 
properly  distributed  among  miners  and  mine  operators. 

Since  April,  1911,  up  to  this  date  a  great  deal  of  work  has  been  done 
involving  the  co-operation  of  a  great  many  persons.  It  was  decided  to 
extend  the  scope  of  the  projected  report  beyond  any  previous  ideas, 
and  instead  of  submitting  a  mere  draft  for  a  mining  law,  to  submit 
such  a  draft  with  copious  annotations,  giving  the  reasons  for  all  opinions 
and  decisions  upon  important  matters  and  several  chapters  in  explana- 
tion of  important  features  of  mine  inspection  and  mining  practice.  The 
report  will  constitute  a  volume  of  about  300  pages.  It  is  now  in  type, 
and  as  soon  as  possible  after  the  revision  of  the  proofs  by  the  committee 
will  be  issued  by  the  United  States  Bureau  of  Mines.  It  is  hoped  that 
this  publication  will  occur  about  the  end  of  this  year. 

Yours  very  truly,  W.  R.  INGALLS. 

SECRETARY  CALLBREATH:  I  might  say,  in  this  connection,  that 
this  committee  is  composed  of  some  of  the  ablest  engineers  of  the 
country.  The  committee  was  first  appointed  at  the  Denver  convention 
in  1906.  After  about  two  years  service  in  getting  together  the  data 
necessary  in  doing  its  work  the  committee  found,  as  Mr.  Ingalls  states 
in  his  communication,  that  the  Mining  Congress  was  not  able  to  finance 
its  work  and  the  members  of  the  committee  did  not  feel  like  performing 
the  work  and  paying  the  bills  for  such  a  work  as  they  have  since  ac- 
complished. At  that  time  the  Bureau  of  Mines  came  to  the  rescue  and 
reappointed  the  committee  as  a  committee  of  the  Bureau  of  Mines,  and 
the  work  has  been  carried  on  under  that  head  since.  This  accounts 
for  the  fact  that  the  chairman  of  the  committee  felt  that  he  could  not 
make  a  regular  report  except  with  the  consent  of  the  director  of  the 
Bureau  of  Mines.  I  am  sure  that  when  this  report  is  made  it  will  be 
found  to  be  one  of  very  great  value,  and  I  trust  that  those  of  you  who 
are  interested  will  make  early  application  to  the  Bureau  of  Mines  for  a 
copy. 

In  this  connection  I  may  say  something  that  I  hope  will  be  said 
more  forcibly  and  completely  hereafter,  and  that  is  that  one  of  the  most 
difficult  things  we  have  in  our  Washington  work  is  to  get  enough  money 
appropriated  so  that  publications  of  this  kind  can  be  generously  dis- 
tributed. The  Bureau  of  Mines  is  limited  in  its  appropriation.  Unfortu- 
nately, as  Dr.  Phillips'  story  illustrated  yesterday,  it  looks  like  a  case 
of  "All  for  the  white  man  and  none  for  the  nigger,"  in  the  division  of 
appropriations.  We  ought  to  have  a  direct  appropriation  to  the  Bureau 
of  Mines  to  cover  its  work,  but  instead  of  that  we  are  forced  to  take  our 
share  of  the  appropriation  made  to  the  Interior  Department,  divided 
up  as  that  department  may  decide,  so  that  in  the  growing  work  of  the 
Bureau  of  Mines  we  only  get  the  same  division  as  we  would  if  the  work 
had  been  thoroughly  established.  In  other  words,  the  older  bureaus 
get  in  proportion  to  previous  appropriations,  holding  the  Bureau  of 
Mines  to  its  present  status.  I  feel  that  in  this  connection  it  is  proper 
for  me  to  say  that  the  Bureau  of  Mines  has  been  engaged  in  the  prepara- 
tion of  a  codification  of  the  mining  laws  of  the  United  States.  That 


AMERICAN     MINING     CONGRESS  «* 

work  is  practically  completed  and  in  the  hands  of  the  printer.  One 
of  the  things  I  have  tried  to  do  in  Washington  was  to  secure  an  appro- 
priation by  which  that  book  might  be  published  in  sufficient  quantities 
so  that  every  mining  man  who  needs  that  work  might  get  it  from  the  gov- 
ernment. We  have  not  succeeded  in  getting  such  an  appropriation.  We 
have  succeeded  in  providing  for  its  publication,  its  distribution  to  the 
libraries  and  the  public  institutions  which  are  entitled  to  have  it,  and 
the  book  will  be  on  sale  at  a  very  low  price.  The  cost  for  printing  the 
first  1,500  copies  being  about  $4,500,  while  the  cost  of  3,500  additional 
copies  would  be  about  $1,500,  but  we  were  unable  to  get  the  order  for 
the  5,000  copies  for  free  distribution,  and  because  we  couldn't  get  that 
$1,500  you  gentlemen  who  need  this  work  will  have  to  buy  it.  It  may 
be  all  right  in  some  senses  that  you  should  buy  it,  because  it  will  come 
to  you  at  a  very  low  cost  from  the  public  printer.  The  only  point  I  make 
it  that  we  need  sufficient  force  back  of  us  so  that  we  can  demand  for 
the  mining  industry  a  special  appropriation  which  will  cover  the  actual 
need  for  the  publication  of  such  works  as  this.  The  Agricultural  De- 
partment during  the  last  18  years  has  distributed  free  nine  million 
copies  of  its  Year  Book  to  the  farmers,  but  when  it  comes  to  publishing 
this  codification  of  the  mining  laws  for  free  distribution  to  miners,  we 
cannot  get  $1,500  to  print  3,500  copies.  The  Agricultural  Department 
can  distribute  500,000  copies  of  a  similar  publication  every  year  and  the 
Bureau  of  Mines  cannot  distribute  3,500  copies  one  time  only.  This 
indicates  very  clearly  the  necessity  for  a  better  organization  of  mining 
men  so  that  we  do  not  have  to  say  please,  but  we  can  say,  "Gentlemen, 
we  want  this  and  we  have  got  to  have  it."  (Applause.) 

THE  PRESIDENT:  Gentlemen,  you  have  heard  the  report  sub- 
mitted by  Dr.  Ingalls.  What  is  your  pleasure  about  it? 

MR.  SWART:  Do  I  understand  this  committee  is  still  a  committee 
•f  the  American  Mining  Congress? 

THE  PRESIDENT:      Yes. 

MR.  SWART:  Then  I  move  that  this  report  be  considered  as  a 
progress  report  and  spread  on  the  minutes. 

SECRETARY  CALLBREATH:  May  I  suggest  a  vote  of  thanks  t« 
that  committee  for  their  efficient  work? 

(Motion  seconded  and  carried  unanimously.) 

THE  PRESIDENT:  The  next  on  the  program  is  the  report  of  th« 
committee  on  revision  of  general  land  laws,  by  Mr.  E.  B.  Kirby  of  St. 
Louis. 

MR.  CLARK:  Mr.  President  and  Gentlemen:  As  one  of  the  mem- 
bers of  the  committee,  I  have  a  letter  from  Mr.  Kirby  addressed  to  me  at 
the  Chamber  of  Commerce  in  which  he  expresses  regrets  that  he  is 
unable  to  present  the  report  and  requesting  me  to  do  so.  I  will  rea* 
the  report: 

Report  of  the  Committee  on  Revision  of  the  Mineral   Land   Laws  to  the 
American  Mining  Congress,  December  9,  1914. 

Since  the  last  annual  convention,  the  American  Mining  Congress 
has  taken  every  opportunity  to  press  for  the  creation  by  the  Congress 
of  the  United  States  of  a  commission  which  shall  revise  and  codify  the 
mineral  land  laws  of  the  United  States. 

Your  committee  takes  pleasure  in  reporting  that  encouraging  prog- 
ress towards  the  desired  end  has  been  made  at  Washington.  A  bill 
(No.  4373),  providing  for  the  appointment  of  the  commission  desired, 
was  introduced  in  the  Senate  by  Senator  Smoot  and  was  approved  by  the 
Secretary  of  the  Interior,  as  follows: 


66  OFFICIAL    PROCEEDINGS 

"Hon.  T.  J.  Walsh,  Chairman  Committee  on  Mines  and  Mining,  United 

States   Senate: 

"My  Dear  Senator— I  am  in  receipt  of  your  letter  of  February  9, 
1914,  transmitting  for  report  a  copy  of  S.  4373,  a  bill  designed  to  provide 
for  a  commission  to  codify  and  suggest  amendments  to  the  general 
mining  laws.  The  bill  provides  that  the  proposed  code  shall  not  deal 
with  lands  containing  deposits  of  coal,  oil,  gas,  phosphates  or  soluble 
potassium  salts.  Various  recommendations  and  amendments  to  the  gen- 
eral mining  laws  have  been  suggested  by  this  department  from  time  to 
time,  and  there  seems  to  be  more  or  less  desire  on  the  part  of  those 
connected  with  prospecting  or  mining  for  certain  amendments  to  the 
law.  The  codification  of  all  laws  relating  to  the  location,  development 
and  disposition  of  such  mineral  lands  would  also,  in  my  opinion,  be 
desirable.  I  believe  that  the  investigations  and  findings  by  such  a 
commission  as  is  provided  for  in  this  bill  would  be  of  material  value  to 
Congress,  and  have  therefore  to  recommend  that  the  measure  be  enacted. 
"Very  truly  yours,  FRANKLIN  K.  LANE." 

The  bill,  after  receiving  some  alterations,  was  favorably  reported  by 
the  Committee  on  Mines  and  Mining,  and  was  passed  by  the  Senate  on 
May  7th.  Meanwhile,  on  April  1,  1914,  Mr.  Taylor  of  Colorado  intro- 
duced) a  similar  measure  (Bill  15288)  in  the  House  of  Representatives, 
which  was  likewise  approved  by  the  Secretary  of  the  Interior  and  favor- 
ably reported  back  to  the  House  by  its  Committee  on  Mines  and  Mining. 

At  that  stage,  Congress  decided  to  restrict  its  legislative  program 
for  the  remainder  of  the  prolonged  session  to  the  trust  bills,  and  your 
representatives  were  informed  that  no  further  progress  with  the  revision 
bills  would  be  possible  until  the  next  session.  Later  on,  the  adminis- 
tration measures  relating  to  coal,  oil,  etc.,  were  added  to  the  legislative 
program  and  it  was  understood  that  the  revision  bill  would  be  included 
with  these.  This  expectation  was  not  fulfilled  and  the  House  adjourned 
without  action  in  the  matter,  so  that  nothing  further  can  be  done  until 
the  winter  session. 

Both  the  Senate  and  the  House  bills  vary  somewhat  from  the  meas- 
ure recommended  by  the  American  Mining  Congress,  which  provided  for 
a  commission  of  five  members  who  should  be  selected  by  the  President 
for  their  recognized  knowledge  and  experience  in  the  mining  industry 
(see  copy  attached).  In  the  Senate  bill,  this  was  amended  to  create  a 
commission  of  three  members,  two  of  whom  should  be  lawyers  and  one 
a  mining  engineer.  The  House  bill,  on  the  other  hand,  permitted  the 
commission  to  consist  of  five  members,  but  provided  that  they  should 
serve  without  compensation. 

While  these  alterations  were  unsatisfactory,  it  is  believed  that  the 
best  opportunity  to  make  further  efforts  for  their  correction  will  be  pre- 
sented after  the  passage  of  the  House  bill  and  when  it  meets  the  Senate 
bill  in  conference. 

Your  committee  believes  that  the  most  important  qualification  of 
the  commission  should  be  its  ability  to  command  the  confidence  of  the 
mining  communities  and  that  this  end  can  be  best  attained  by  having 
at  least  five  members  and  leaving  the  President  free  in  making  the  se- 
lections. Moreover,  the  members  should  be  properly  paid  so  that  the 
appointments  may  not  be  restricted  to  men  of  wealth  and  in  order  that 
the  business  may  be  undertaken  in  a  serious  way,  befitting  its  import- 
ance. The  House  bill  will  shut  out  from  any  possibility  of  selection 
the  vast  majority  of  mining  men  as  it  restricts  the  personnel  of  the 
commission  to  those  who  have  the  rare  combination  of  a  knowledge 
of  the  subject,  a  desire  to  work  for  it,  and  who,  at  the  same  time,  possess 
such  incomes  and  freedom  from  business  duties  that  they  can  leave 
their  own  affairs  for  six  months  of  arduous  labor,  and  bear  the  serious 
expenditures  which  cannot  be  included  in  government  accounts. 


AMERICAN     MINING     CONGRESS  67 

At  the  proper  time,  further  efforts  will  be  made  to  have  these 
difficulties  considered  by  those  who  are  in  charge  of  the  bills,  but  in 
any  case,  it  is  probable  that  a  revision  bill  will  be  passed  at  the  next 
session. 

In  the  meantime,  public  interest  is  growing  and  the  forces  massing 
back  of  the  revision  movement  are  steadily  increasing.  In  the  American 
Institute  of  Mining  Engineers  and  the  Mining  and  Metallurgical  Society 
of  America,  no  other  matter  of  public  policy  has  been  commanding  such 
interest  as  this.  In  both  organizations,  the  sentiment  in  favor  of  a 
general  revision  is  overwhelming  and  each  one  has  gone  as  far  as  it 
could  in  approving  and  aiding  the  movement.  The  American  Institute 
of  Mining  Engineers  has  been  specially  restricted  in  its  support  by 
provisions  in  its  constitution  which  bar  it  from  taking  up  public  ques- 
tions and  an  effort  is  now  being  made  to  have  its  sphere  of  activity 
enlarged. 

In  the  meantime,  the  American  Mining  Congress  remains  as  the  only 
general  organization  of  the  great  mining  industry  which  is  in  a  position 
to  freely  voice  its  wishes  and  act  for  its  interests  in  any  direction. 
There  has  certainly  never  been  a  time  when  these  interests  have  needed 
co-operation  and  intelligent  direction  so  much  as  they  do  now,  and  min- 
ing men  cannot  afford  to  have  the  activities  of  the  Congress  weakened 
through  any  lack  of  financial  support. 

Practical  experience  has  shown  that  to  be  effective,  the  recommen- 
dation of  the  Congress  upon  any  matter  must  be  properly  presented  at 
Washington,  and  this  requires  steady,  persistent  work  by  some  one  who 
can  stay  there.  At  present,  there  is  no  way  of  securing  this  until  the 
Secretary  of  the  American  Mining  Congress  is  given  the  means  with 
which  to  carry  on  his  work  in  the  proper  way.  This  is  absolutely 
necessary  to  supplement  the  efforts  of  your  various  committees  who  can 
only  act  through  correspondence  and  the  occasional  visits  of  their  mem- 
bers. 

The  mining  industry  cannot  hope  that  any  of  the  afflictions  from 
which  it  is  suffering  will  disappear  by  chance.  The  only  help  in  sight 
is  self  help,  the  labor  and  money  contributed  by  mining  men  to  the  work 
of  the  American  Mining  Congress. 

(Signed)  EDMUND  B.  KIRBY,  Chairman. 


Committee: 

E.  B.  Kirby,  St.  Louis,  Mo.,  Chairman. 
Alaska — L.  V.   Ray,   Seward. 
Arizona — Will  L.  Clark,  Jerome. 
California — E.   H.  Benjamin,   San  Francisco. 
Colorado — Victor  C.  Alderson,  Denver. 
District   of   Columbia — Hennen  Jennings,   Washington. 
Idaho — J.  R.  Richards,  Boise. 
Montana — William  Scallon,  Helena. 
Minnesota — Horace   V.   Winchell,   Minneapolis. 
Missouri — E.  B.  Kirby,  St.  Louis. 
Nevada — D.  C.  McDonald,  Ely. 
New  Mexico — C.  T.  Brown,  Socorro. 
Oregon — H.  H.  Schwartz,  Portland. 
Texas — Isadore  Broman,  Austin. 
Utah— W.  H.   King,  Salt  Lake. 
Washington — L.    K.    Armstrong,   Spokane. 
Wyoming— Edwin  Hall,  Lusk. 


«S  OFFICIAL     PROCEEDINGS 

Appendix. 

Preliminary   Draft  Suggested  for  a  Joint   Resolution  of  the   Senate   and 

House. 

That  Congress  shall  undertake  a  general  revision  of  the  laws  relating 
to  mineral  bearing  lands  and  mineral  rights  within  the  United  States 
and  Alaska,  and  such  revision  shall  cover  mineral  deposits  of  every 
kind  except  those  of  coal,  oil,  phosphates  and  salines,  which  are  set 
aside  as  the  subjects  of  other  and  special  legislation. 

In  view  of  the  technical  nature  of  the  problems  presented  by  the 
work  it  is  desired  to  secure  first  the  results  of  the  knowledge  and  ex- 
perience which  exists  among  those  who  are  engaged  in  the  mining  in- 
dustry. 

To  this  end-  the  President  shall,  within  60  days  hereafter,  appoint 
a  commission  of  five  members  who  shall  be  selected  for  their  recognized 
knowledge  and  experience  in  the  mining  industry. 

The  commission  shall  consider  the  mining  laws  of  this  and  other 
countries  and  shall  hold  public  hearings  in  the  principal  mining  centers 
of  the  Western  States  and  Alaska,  giving  full  opportunity  for  the  expres- 
sion of  public  opinion  concerning  the  problems  before  it.  Its  recom- 
mendations shall  be  presented  in  the  form  of  a  fully  drafted  mining  code. 

Within  six  months  after  the  appointment  of  the  commission  its  re- 
port shall  be  delivered  to  the  President,  who  shall  within  30  days  there- 
after transmit  it  to  Congress  with  his  further  recommendation  if  there 
be  any. 

Members  of  the  commission  shall  receive  per  diem  with  expenses 
and  shall  engage  such  clerical  assistance  as  may  be  necessary  for  the 
work. 

(Clause  providing  for  the  necessary  appropriation.) 

Resolution  above  introduced  by  Will  L.   Clark. 

(Applause.) 

THE  PRESIDENT:  Gentlemen,  you  have  heard  the  report  of  tk« 
Committee  on  Revision  of  General  Land  Laws.  What  is  your  pleasure 
about  the  report?  Is  there  any  discussion? 

MR.  CLARK:  Mr.  Chairman,  in  connection  with  the  report  we  hav« 
prepared  a  resolution  which  I  will  also  read: 

RESOLUTION   NO.   2. 
(Introduced  by  the  Committee  on  Revision  of  Mineral  Land  Laws.) 

Be  It  Resolved,  By  the  American  Mining  Congress,  in  regular  con- 
vention assembled  at  Phoenix,  Arizona, 

That  Congress  shall  be  urged  to  provide  for  a  general  revision  of 
the  laws  relating  to  mineral  bearing  lands  and  mineral  rights  within  the 
United  States  and  Alaska,  and  such  revision  shall  cover  mineral  deposits 
of  every  kind  except  those  of  coal,  oil,  phosphates  and  salines,  which  are 
set  aside  as  the  subjects  of  other  and  special  legislation. 

In  view  of  the  technical  nature  of  the  problems  presented  by  the 
work  it  is  desired  to  secure  first  the  results  of  the  knowledge  and  ex- 
perience which  exist  among  those  who  are  engaged  in  the  mining  in- 
dustry. 

To  this  end  it  is  urged  that  the  President  shall,  within  60  days 
hereafter,  appoint  a  commission  of  five  members  who  shall  be  selected 
for  their  recognized  knowledge  and  experience  in  the  mining  industry. 

The  commission  shall  consider  the  mining  laws  of  this  and  other 
countries,  and  shall  hold  public  hearings  in  the  principal  mining  centers 


AMERICAN     MINING     CONGRESS  It 

of  the  Western  States  and  Alaska,  giving  full  opportunity  for  the  ex- 
pression of  public  opinion  concerning  the  problems  before  it.  Its  recom- 
mendation shall  be  presented  in  the  form  of  a  fully  drafted  mining  code. 

Within  six  months  after  the  appointment  of  the  commission  its  re- 
port shall  be  delivered  to  the  President,  who  shall  within  30  days  there- 
after transmit  it  to  Congress  with  his  further  recommendations  if  there 
be  any. 

Members  of  the  commission  shall  receive  per  diem  with  expenses 
and  shall  engage  such  clerical  assistance  as  may  be  necessary  for  tfae 
work. 

(Clause  providing   for  the   necessary   appropriation.) 

MR.  CLARK:  I  have  left  blank  the  clause  to  be  provided  for  the 
necessary  appropriation. 

Regarding  this  resolution,  as  set  forth  by  the  report,  a  good  deal  of 
progress  has  been  made,  and  the  bills  now  before  Congress  should  be 
amended  in  conference,  so  the  committee  thinks,  to  include,  as  stated, 
five  members  instead  of  three  as  provided  by  the  Senate  bill,  and  that 
these  members  should  be  paid  a  per  diem  and  expenses  in  order  that 
selection  may  be  freely  made  from  those  who  should  appear  to  be  best 
fitted  for  the  work  without  involving  personal  labor  and  expenses  to 
appointees.  Now,  I  will  not  go  into  the  subject  of  the  great  need  of 
revision  of  the  mineral  land  laws  at  any  length,  because  that  has  been 
discussed,  and  I  believe  every  Western  mining  man  and  nearly  every 
one  engaged  in  the  industry,  understand  the  very  pressing  need  of  this 
work.  It  is  one  of  those  things  which  have  been  talked  about  so  fre- 
quently that  revision  should  have  been  granted  by  the  Congress  of  the 
United  States  immediately  that  this  was  presented  to  them  in  proper 
form,  yet  men  have  worked  on  this  proposition  for  over  twenty  years. 
Some  of  the  most  eminent  men  in  the  mining  industry  in  the  United 
States  have  devoted  much  time  and  labor  to  it.  Dr.  Raymond,  for  in- 
stance, told  me  he  had  repeatedly  formulated  resolutions  on  the  subject; 
and  following  that  along,  I  talked,  myself,  once  with  five  United  States 
senators,  happening  to  catch  them  together,  about  the  matter,  and  they 
said,  "Oh,  it  is  a  monumental  work."  I  told  them  I  thoroughly  disagreed 
with  that  view,  and  they  could  select  a  commission  that  could  easily  do 
the  work  and  do  it  well.  I  said  a  year,  and  they  seemed  to  be  amazed; 
yet  this  provides  for  six  months,  and  it  can  easily  be  done,  I  believe,  in 
six  months.  For  a  while  there  was  a  difficulty  about  it,  during  the  acute 
stage  of  the  discussion,  concerning  extra-lateral  rights,  but  now  there 
is  a  general  agreement  that  they  can  be  done  away  with.  Now,  just  one 
phase  of  the  subject,  the  question  of  the  discovery  of  oil,  or  even  of 
mineral  as  an  absolute  necessary  requirement  under  the  present  laws. 
There  is  no  reason  why  you  should  have  to  discover  it.  The  policy  of 
this  government  has  always  been  to  invite  the  taking  up  of  the  public 
lands  and  to  sell  them  at  very  reasonable  prices,  and  when  you  hare 
gone  through  all  this  rigmarole  of  making  a  discovery — if  you  have  a 
claim  that  is  any  good  at  all  you  may  have  a  few  lawsuits  during  the 
intricacies  of  patenting  and  things  of  that  kind,  and  the  government 
finally  sells  you  that  land  at  $5  an  acre.  Now  I  don't  think  there  would 
be  any  difficulty  if  they  classified  it  as  worth  more  than  that,  the  same 
as  the  coal  lands,  say  $20  an  acre,  within  reasonable  transportation 
or  water  haul,  and  with  less  amounts  to  those  prospectors  who  are  far 
in  the  mountains  and  who  would  necessarily  have  to  wait  a  long  time. 
But  in  any  event  it  is  so  simple  that  if  the  Congress  of  the  United 
States  would  be  properly  approached  by  this  great  industry  we  should 
have  first  the  classification  of  these  lands,  and  following  that  it  is  very 
easy  to  provide  simple  methods  of  having  these  lands  appropriated  by 
those  who  want  to  develop  them.  As  has  been  well  said  here  before,  it 
should  be  just  the  same  as  taking  up  any  other  land,  but  it  has  beea 


70  OFFICIAL     PROCEEDINGS 

hedged  about  by  all  these  troubles,  some  of  which  the  miners  are  re- 
sponsible for  themselves,  but  at  the  same  time  it  is  now  at  a  point 
where  this  revision  should  be  pushed.  The  other  striking  reason  why 
this  has  become  a  very  great  necessity  to  the  West  is  the  question  we 
have  talked  of  of  how  should  the  mining  industry  of  the  West  be  pro- 
moted, how  should  it  be  aided?  One  of  the  greatest  aids  you  could 
possibly  give  it  is  this  revision  of  the  general  land  laws.  Why?  It  is 
well  known  that  if  a  mining  proposition  is  presented  to  investors  one 
of  the  very  first  and  strongest  objections  that  they  will  make  to  going 
into  such  an  investment  is  the  probability  of  litigation.  That  old  subject 
comes  right  up.  Everyone  has  heard,  "Well,  if  you  find  anything  you 
will  get  into  litigation."  That  condition  of  affairs  could  be  ended,  and 
it  could  easily  be  ended  by  this  Congress  if  there  is  just  a  little  more 
work  done.  We  have  got  far  enough  along  now  where  it  is  practically, 
I  should  say,  only  a  question  of  a  little  further  effort;  and  I  want  to 
say  a  word  for  Mr.  Kirby,  our  chairman,  who  has  personally  gone  to 
Washington  a  number  of  times  and  worked  on  this  matter  and  has  de- 
voted his  time  and  money  to  this  very  freely,  and  other  members  have 
done  so.  Professor  Winchell,  also  of  the  committee,  has  performed  a 
deal  of  work  in  various  ways  and  by  discussion  in  the  technical  papers. 
I  think  now  if  every  one  of  the  delegates,  in  addition  to  the  formal 
resolution — a  resolution  may  get  pigeonholed,  but  if  every  one  of  the 
delegates  to  this  Congress,  whether  they  have  personal  acquaintance 
or  not  with  their  representatives  in  Congress,  will  write  a  letter  once  a 
month  asking  what  has  been  done  in  regard  to  this  revision  of  the 
general  land  laws,  I  am  sure  you  will  secure  the  appointment  of  a  com- 
mittee to  revise  them  at  this  session  of  the  Congress  of  the  United 
States.  (Applause.) 

THE  PRESIDENT:  Gentlemen,  you  have  heard  the  most  instructive 
report  of  the  Commitee  on  the  Revision  of  the  General  Land  Laws,  and 
the  resolution.  What  is  your  pleasure  with  the  report,  in  the  first  place? 
I  suggest  we  consider  them  separately. 

MR.  F.  L.  SIZER:  I  move  the  adoption  of  the  report  as  presented 
by  Mr.  Clark  and  thanks  to  the  committee  for  their  work;  that  the  re- 
report  of  the  Committee  on  the  Revision  of  the  General  Land  Laws,  and 
gentlemen  who  framed  it,  and  that  the  committee  be  continued. 

THE  PRESIDENT:     Is  there  any  further  discussion  of  the  matter? 
(Motion  seconded   and  carried  unanimously.) 

THE  PRESIDENT:  I  would  suggest  that  the  resolution  be  referred 
to  the  Resolutions  Committee. 

We  will  be  obliged  to  deviate  from  our  program,  because  Dr.  Tal- 
mage  is  going  away,  and  I  will  call  on  him  to  present  his  address  on 
the  proper  advertising  of  mining  opportunities.  I  may  say  that  adver- 
tising is  one  of  the  great  American  games,  and  I  have  learned  some  les- 
sons in  these  arid  countries.  On  one  of  my  early  trips,  in  approaching  a 
town  after  a  long  cross-country  drive,  I  saw  a  big  sign,  "First  Chance," 
and  upon  getting  near  I  found  there  was  a  saloon.  As  I  left  the  town 
I  noticed  a  sign  on  the  other  side  of  the  building  reading  "Last  Chance." 
They  have  us  both  coming  and  going.  Mr.  Talmage's  subject  is  one  of 
more  serious  character,  and  I  am  sure  we  have  much  to  learn  from  him. 

Dr.  Talmage's  paper  will  be  found  at  page  172  of  this  report. 

THE  PRESIDENT:  Gentlemen,  we  have  certainly  enjoyed  Dr.  Tal- 
mage's able  address,  and  will  now  proceed  to  another  address,  which 
promises  to  be  equally  instructive  and  interesting,  by  Mr.  W.  G.  Swart, 
on  "The  First  Move." 

Mr.  Swart's  paper  will  be  found  at  page  144  of  this  report. 


AMERICAN     MINING     CONGRESS  71 

MR.  SIZER:  Mr.  Chairman,  I  would  like  to  ask  Mr.  Swart  to  supple- 
ment his  very  interesting  paper  by  a  private  statement  of  how  the  Colo- 
rado system  of  assisting  prospectors  has  worked  out. 

MR.  SWART:  I  am  fortunate  enough,  or  unfortunate  enough,  as 
you  may  look  at  it,  to  be  the  chairman  of  the  Mining  Committee  of  the 
Denver  Chamber  of  Commerce.  You  probably  know  more  or  less  of  the 
movement  which  was  started  up  there  two  years  ago.  One  of  our  news- 
papers started  something  out  of  a  clear  sky.  They  sent  around  to  a 
number  of  prominent  mining  operators  and  found  out  they  were  of  the 
opinion  that  something  was  wrong  with  mining,  and  that  it  was  the  lack 
of  prospecting  which  was  at  the  base  of  the  trouble,  so  the  newspaper 
asked  if  they  would  not  contribute  to  a  fund  to  help  prospecting.  In 
two  days  this  newspaper  raised  $11,000  among  a  few  of  the  mining  men 
of  Colorado.  They  were  all  glad  to  contribute,  and  the  newspaper 
turned  the  fund  over  to  the  Denver  Chamber  of  Commerce  to  handle, 
which  body  appointed  a  special  committee  for  that  one  purpose  and  the 
committee  labored  all  through  the  summer  and  into  the  late  fall.  That 
fund  put  84  prospectors  in  the  field.  As  a  rule,  they  were  put  out  in 
pairs.  When  the  movement  was  started  it  hadn't  been  fully  considered 
from  a  legal  standpoint.  The  fact  was  the  Denver  Chamber  of  Com- 
merce was  not  organized  for  profit,  and  therefore  it  could  not  partici- 
pate. Nevertheless  the  prospectors  were  sent  out  under  a  written  agree- 
ment that  they  should  have  half  of  whatever  they  found  and  the  Denver 
Chamber  of  Commerce  the  other  half  through  trustees  who  acted  for  the 
Denver  Chamber  of  Commerce.  Those  prospectors  went  out  in  the  field 
and  spent  the  summer.  There  were,  I  think,  eight  finds — about  10%. 
Several  engineers  went  out  to  see  them,  reporting  that  out  of  the  eight 
there  were  two  which  showed  some  promise  of  becoming  mines.  Then 
came  up  this  important  point,  that  there  is  a  marked  distinction  between 
prospecting  and  developing.  No  provision  whatever  had  been  made  for 
the  development  of  these  prospects.  Now,  what  was  the  use  of  sending 
the  prospectors  out  to  simply  uncover  something  unless  you  wen 
going  on  and  turn  the  thing  into  a  mine?  We  found  ourselves  facing  a 
situation  that  simply  could  not  be  handled  by  our  organization,  because 
any  time  you  start  a  game  of  that  sort  on  the  sole  basis  of  benefitting 
the  state  of  Colorado  or  the  state  of  Arizona,  and  doing  something  for 
the  public  good,  you  are  going  to  fail.  There  is  just  one  thing  on  which 
to  base  mining,  and  that  is  the  making  of  money.  So  we  were  forced  to 
abandon  this  method,  which,  had  it  been  organized  for  purely  business 
purposes,  would  have  worked  out  all  right,  and  I  say  that  it  would  have 
worked  out  all  right  because  since  that  time  some  of  us  have  taken 
the  idea  over  and  it  is  this  little  organization  I  have  mentioned  where 
ten  engineers  joined  hands  and  efforts  which  really  is  the  successor  of 
that  prospecting  enterprise.  The  thing  as  originally  planned  was 
dropped;  it  failed;  there  was  no  development  money  raised  and  nothing 
real  was  accomplished.  The  prospects  which  had  been  found  were 
turned  over  to  the  prospectors  with  the  compliments  of  the  Denver 
Chamber  of  Commerce.  What  they  have  done  with  them  since  I  do  not 
know.  But  as  the  successor  to  that  movement,  the  men  who  really 
believed,  the  men  who  knew,  the  engineers,  the  mining  men  themselves, 
organized  this  little  company  which  I  have  just  mentioned.  The  ten  of 
them  got  together  and  their  undertaking  has  been  a  success.  I  am  sorry 
I  can't  give  you  all  the  details  of  it.  I  will  be  glad  to  do  so  privately, 
but  it  is  a  close  corporation  and  has  its  own  affairs  and  secrets,  of 
which  I  do  not  feel  at  liberty  to  speak  freely.  But  I  am  willing  to  stand 
here  and  say  that  the  enterprise  has  been  an  unqualified  success,  and 
can  be  made  a  success  in  any  community  when  taken  up  in  a  similar  way. 
If  the  trained  mining  men  will  get  together,  will  keep  their  heads  and 
will  organize  the  sentiment  of  their  community  behind  them,  and  will 
then  direct  it,  you  won't  need  to  worry  about  the  mining  industry;  it  will 
take  care  of  itself. 


72  OFFICIAL     PROCEEDINGS 

THE  PRESIDENT:  Gentlemen,  I  am  sure  I  voice  the  sentiment 
of  this  meeting  when  I  express  the  thanks  of  the  Congress  to  Mr.  Swart 
for  his  able  paper,  which  so  clearly  emphasizes  to  my  mind  the  analogy 
between  mining  and  farming.  As  I  came  up  the  Salt  River  valley  day 
before  yesterday  I  was  impressed  with  the  greatness  of  the  desert,  and 
one  of  my  companions  who  had  never  been  West. asked  me,  "What  is 
this  land  good  for?"  I  told  him  to  withhold  his  opinion — which  was 
not  very  favorable — until  we  came  nearer  this  town,  having  heard  of 
the  great  water  project  which  you  have  here,  and  he  was  very  willing  to 
agree  with  me  that  nothing  more  was  wanted  than  a  little  water  to  con- 
vert a  desert  into  a  wonderful  oasis.  I  think  the  prospector  and  his 
field  are  very  similar.  He  has  the  desert  before  him,  and  if  he  can  only 
get  a  little  water  he  will  soon  develop  wonderful  mines. 

The  next  number  on  the  program  is  an  address  to  be  delivered  by 
Mr.  Walter  Douglas.  I  may  say  that  on  my  first  trip  West  some  fifteen 
years  ago,  after  I  crossed  the  Missouri  river,  and  as  we  approached  El 
Paso,  in  the  smoking  car  of  the  Pullman  I  overheard  two  or  three  men 
talking  something  about  a  copper  queen,  and  having  only  recently  come 
to  this  country,  being  one  of  those  poor  Germans  who  left  his  home 
country  to  look  for  greater  opportunities,  I  had  my  ear  to  the  windward 
looking  for  an  heiress,  and  the  words  "copper  queen"  appealed  to  me, 
and  I  wondered  where  she  lived.  (Laughter.)  I  didn't  have  much  hope 
of  meeting  her,  because  I  hadn't  been  mixing  with  royalty;  I  had  been 
a  miner  all  my  life,  and  the  chances  were  pretty  slim.  But  much  to  my 
disappointment  I  found  that  the  copper  queen  was  not  a  dusky  lady  but 
a  copper  mine.  It  was  my  pleasure  afterwards  to  meet  a  gentleman 
connected  with  this  mine  and  who  is  well  known  to  you,  and  I  feel  that 
it.  would  not  be  improper  for  me  to  bestow  upon  him  the  name  of  the 
Copper  Prince.  I  have  the  pleasure  of  introducing  to  you  Mr.  Walter 
Douglas,  who  is  going  to  read  a  paper  on  "Legislation  and  the  Mining 
Industry  in  Arizona."  I  may  say  that  we  have  invited  the  legislators  of 
this  state  to  attend  this  meeting,  and  I  hope  they  are  here  and  will 
profit  by  what  Mr.  Douglas  has  to  say.  (Applause.) 

MR.  WALTER  DOUGLAS:  Mr.  President  and  Members  of  the 
American  Mining  Congress:  It  is  very  embarrassing  for  me  to  get  up 
and  speak  after  an  introduction  of  that  kind.  In  connection  with  the 
Copper  Queen  in  the  gossip  of  a  smoking  room,  I  think  the  most  amusing 
thing  was  the  member  of  our  company  who  was  coming  out  on  the 
Rock  Island  line  and  he  heard  some  tourists  who  were  going  out  to 
Arizona  discussing  matters  pertaining  to  the  West.  At  that  time  the 
El  Paso  &  Southwestern  had  for  its  trademark  the  head  of  an  Indian 
surrounded  by  a  circle,  and  on  it  the  words  "Copper  Route,"  and  one  of 
the  tourists  was  explaining  how  this  Indian  had  discovered  the  Copper 
Queen  mine  and  had  developed  it  and  that  his  name  was  Dr.  Douglas. 
(Laughter.) 

Before  reading  this  very  brief  paper  which  I  have  prepared  on  re- 
cent legislation  affecting  the  Arizona  mining  industry,  it  might  be  proper 
for  me  to  state  that  no  reference  whatever  has  been  made  to  the  initiative 
and  referendum  measures  which  were  passed  at  the  last  election,  and 
their  effect  and  constitutionality  can  only  be  predicated  at  this  time. 

Mr.  Douglas'  paper  will  be  found  at  page  140  of  this  report. 

THE  PRESIDENT:  I  am  sure  we  have  learned  much  from  Mr. 
Douglas'  valuable  paper,  and  thank  him  for  the  able  presentation  thereof. 

Several  years  ago  when  I  attended  a  meeting  of  the  Congress,  I  was 
late  one  day,  just  as  most  of  you  gentlemen  were  this  morning,  but  the 
chairman  was  not  as  considerate  as  I  have  been.  He  had  started  the  pro- 
ceedings, and  a  tall  Westerner  had  the  floor,  and  in  a  very  vigorous  way 
delivered  an  address  which  come  home  pretty  close  to  all  those  present. 


AMERICAN     MINING     CONGRESS  73 

I  have  reference  to  the  senator  of  your  neighboring  state,  Hon.  John  F. 
Shafroth.  He  is  unable  to  be  here  today  because  another  Congress,  the 
one  at  Washington,  has  called  on  his  time,  but  he  has  given  us  a  paper 
which  I  am  going  to  ask  the  Secretary  to  read,  on  "The  Administration'* 
Public  Lands  Policy." 

SECRETARY  CALLBREATH:  I  would  suggest,  in  view  of  the  fact 
that  that  paper  has  been  printed  and  distributed  among  the  members, 
that  we  dispense  with  the  reading  of  both  that  and  the  following  paper 
and  that  they  be  printed  in  the  proceedings. 

(Motion  seconded  and  carried  unanimously.) 

Senator  Shafroth's  address  will  be  found  at  page  207  of  the  report. 

The  next  and  last  item  on  the  program  this  morning  is  "Conserva- 
tion, State  or  National?"  by  Dr.  William  B.  Phillips  of  Austin,  Texas. 
Dr.  Phillips  doesn't  need  any  further  introduction. 

DR.  PHILLIPS:     Have  you  that  paper,  Mr.  Secretary? 
SECRETARY  CALLBREATH:     It  doesn't  seem  to  be  here. 
DR.  PHILLIPS:     Gentlemen,  that  is  a  very  important  paper. 
THE  PRESIDENT:     How  do  we  know? 

DR.  PHILLIPS:  Because  I  wrote  it.  I  have  no  copy  of  it  here;  I 
have  it  at  the  hotel;  and  the  Secretary  has  no  copy  of  it.  I  am  going 
to  ask  you  to  allow  me  to  read  that  paper  this  afternoon,  and  will  add 
that  it  is  going  to  be  a  very  good  paper. 

(Cries  of  "Go  on.") 

DR.  PHILLIPS:  It  was  on  the  subject  of  conservation,  whether 
there  should  be  state  or  national  control  of  this  important  matter,  and  in 
that  paper  I  have  endeavored  to  point  out  some  of  the  fundamental  prin- 
ciples governing  the  so-called  conservation  movement  in  this  country. 
I  do  not  see,  myself,  how  we  can  have  any  considerable  conservation  of 
our  resources  without  a  very  considerable  degree  of  development.  I  do 
not  see  how  we  can  conserve  a  mining  industry  that  has  not  already 
been  developed;  nor  do  I  see  how  we  can  conserve  anything  without 
sufficiently  regulated  authority.  Whether  that  authority  is  to  be  state 
or  national  will  largely  depend  on  circumstances  over  which  I  think  we 
have  very  little  control.  It  would  appear  that  we  for  many  years  in  this 
country  have  drifted  into  a  condition  which  the  early  founders  of  this 
republic  neither  contemplated  nor  provided  for.  We  have  seen  in  recent 
years  an  attempt  on  the  part  of  one  of  the  states  to  regulate  the  minimum 
price  at  which  oil  shall  be  sold  within  that  state.  If  the  state  has  a 
right  to  do  that  it  has  a  right  to  fix  the  minimum  price  at  which  any 
product  can  be  sold  within  that  state.  The  power  to  regulate  one  re- 
source is  the  power  to  regulate  all.  If  I  am  forbidden  to  sell  my  oil  at 
a  minimum  price  I  can  also  be  forbidden  to  sell  my  lead  or  copper  or 
zinc  or  tin  or  gypsum  or  salt  or  cement  or  anything  that  I  may  produce. 
The  same  principle  applies  to  all  as  applies  to  one.  A  sister  state,  and 
the  one  to  which  I  refer,  attempted,  two  or  three  years  ago  to  prevent 
the  exportation  of  natural  gas  from  without  its  borders,  claiming  that 
its  natural  resources  were  to  that  extent  being  depleted  and  that  there- 
fore it  had  a  right  to  protect  itself.  It  endeavored  to  prevent  the  transfer 
of  its  natural  gas  supplies  to  a  neighboring  state  under  the  plea  that 
such  transfer  would  deplete  its  own  resources  and  it  would  thereby  be 
to  some  extent  impoverished.  It  didn't  take  long  for  the  United  States 


74  OFFICIAL     PROCEEDINGS 

Supreme  Court  to  dispose  of  this  case  when  it  came  up.  It  held  that 
no  state  had  a  right  to  pass  laws  forbidding  the  exportation  of  its  mineral 
products  to  a  neighboring  state.  It  would  appear  ridiculous  to  most  of 
us  that  such  a  case  could  ever  have  gone  as  far  as  the  United  States 
Supreme  Court.  It  has  happened  within  very  recent  time  and  is  happen- 
ing today  that  an  important  oil  producing  state  in  the  Union  is  seeking, 
through  a  commission,  to  regulate  the  oil  business,  not  only  to  fix  the 
maximum  and  minimum  price  but  to  some  extent  also  to  limit  produc- 
tion. We  have  seen  that  same  principle  cropping  out  in  some  of  the 
large  cotton  producing  states  by  which  it  was  sought,  under  the  guise 
of  law,  to  limit  the  cotton  acreage  and  to  make  it  an  offense  punishable 
by  fine  and  imprisonment  for  any  man  to  plant  beyond  a  certain  number 
of  acres  of  cotton  during  the  year  1915.  Such  legislation  is  highly 
socialistic  in  its  tendency  and  can  be  charged  neither  to  the  old  line 
Democratic  party  nor  to  the  old  line  Republican  party.  If  we  are  ready 
in  this  country,  gentlemen, ^  for  the  government  to  take  control  of  the 
conservation  of  our  resources  we  must  at  the  same  time  be  ready  for  it 
to  control  the  means  by  which  those  resources  are  brought  into  use.  If 
we  would  conserve  our  supplies  of  oil  or  natural  gas  or  coal  or  copper  or 
whatever  it  may  be,  it  can  only  be  through  the  administration  of  law 
either  of  state  or  of  national  origin.  If  we  are  to  say  that  our  coal 
resources  in  some  parts  of  this  country  are  being  depleted  too  rapidly 
we  can  only  remedy  that  defect  by  taking  charge  of  that  production 
either  through  the  state  or  national  administration.  If  we  say  that  our 
oil  supplies  in  Oklahoma  or  Texas  or  California  or  wherever  it  may  be 
are  being  depleted  too  rapidly,  if  there  is  too  swift  an  exhaustion  of 
our  supplies  of  natural  gas,  we  can  only  control  that  matter  through 
governmental  agency.  In  our  own  state  we  have  passed  a  law  regulating 
the  waste  of  gas  wells.  If  you  will  bear  with  me  for  one  moment  I 
will  relate  a  circumstance  which  has  taken  place  in  that  state  within 
the  last  three  weeks  seven  miles  from  the  city  of  Corpus  Christi,  which 
is  on  the  Gulf,  and  just  across  an  arm  of  the  bay.  Three  weeks  ago  an 
enormous  gas  well  was  brought  in.  The  pressure  was  sufficient  to  send 
a  column  of  mud  and  water  and  gas  one  hundred  and  fifty  feet  high,  and 
it  was  visible  during  the  day  time  for  a  distance  of  nearly  ten  miles. 
It  was  absolutely  impossible  to  control  that  well.  The  estimated  flow 
was  fifty  million  feet  a  day.  That  well  inside  of  ten  days  choked  itself 
at  the  bottom  and  it  is  now  a  mud  volcano.  The  derrick,  machinery,  and 
so  forth,  fell  into  the  hole,  and  it  is  spouting  mud  and  water  and  all  the 
other  devilment  it  can  collect  for  a  depth  of  a  thousand  feet.  (Laughter.) 
Its  owners  are  liable  under  the  law  for  wastage  of  gas.  They  would  be 
glad  to  pay  any  man  $50,000  this  minute  to  go  there  and  stop  that  flow 
of  gas.  Three  old  wells  in  the  immediate  vicinity  that  haven't  yielded 
oil  or  gas  have  begun  to  spout.  The  bottom  of  the  sea  nearby — the 
well  is  immediately  on  the  coast — is  bubbling  and  heaving  every  day 
with  the  amount  of  pressure  of  that  gas  seeking  to  relieve  itself  from 
underneath.  We  had  the  same  experience  in  the  great  gas  fields  of 
Caddo  in  Louisiana,  where  gas  not  only  ran  for  several  years  uncontrolled 
but  finally  caught  fire,  and  I  have  myself  seen  that  fire  twenty-five  miles 
away  at  night,  so  tremendous  was  it.  The  state  of  Louisiana  finally 
served  notice  on  the  owners  of  the  well  that  that  flow  of  gas  had  to  be 
stopped,  and  the  question  arose  how  to  do  it.  The  state,  in  effect,  served 
notice  upon  them  that  if  it  was  not  stopped,  by  virtue  of  the  right  of 
eminent  domain  it  would  itself  take  charge  of  that  property  and  stop 
the  flow  of  gas  and  charge  the  expense  against  the  property;  whereupon 
the  owners  of  the  well  got  busy,  as  the  saying  is,  and  finally  controlled 
it,  at  a  very  high  expense,  and  that  gas  is  now  being  piped  as  far  north 
as  Hot  Springs  and  Little  Rock  in  Arkansas,  and  is  finally,  I  believe, 
destined  to  reach  St.  Louis,  a  distance  of  about  six  hundred  and  fifty 
miles. 

We  are  facing,  I  believe,  gentlemen,  a  very  important  turn  of  the 


AMERICAN     MINING     CONGRESS  75 

road  in  industrial  development  in  this  country.  It  has  come  so  insidiously 
as  to  escape  the  notice  even  of  very  observing  men,  and  that  is  the 
tendency  to  apply  to  the  government  every  time  anything  goes  wrong 
with  business.  If  things  are  wrong  in  the  oil  business  we  go  to  the 
legislature  for  relief.  If  anything  is  wrong  in  the  gas  business  we  run 
to  the  legislature  or  to  the  national  government  for  relief.  You  are  all 
more  or  less  familiar  with  the  operations  of  the  Interstate  Commerce 
Commission,  by  which,  through  a  central  agency,  we  are  now  controlling 
inland  freight  rates.  There  are  forty-seven  or  forty-eight  states  in  this 
Union  enacting  laws  bearing  more  or  less  upon  the  mining  industry,  and 
in  our  own  state,  which  is  not  remarkable  for  the  value  of  its  mineral 
products — we  get  only  about  thirty  million  a  year  there — we  make  up  in 
legislation  what  we  lack  in  production.  (Laughter.)  If  you  will 
pardon  me  a  few  moments:  The  state  of  Texas  has  had  its 
own  land  office — and  this  matter  bears  directly  upon  the  subject 
which  I  am  attempting  to  discuss  in  a  brief  way — for  seventy-five  years. 
It  was  opened  in  1838  and  they  had  at  that  time  some  seventy-nine 
million  acres  of  land  to  dispose  of.  You  know  Texas  ran  as  far  north 
as  Cheyenne,  Wyoming,  and  took  in  a  large  portion  of  Colorado  and  New 
Mexico.  The  New  Mexico  portion  was  sold  to  the  national  government 
in  1851  for  $10,000,000.  We  were  not  very  prudent  in  that  day  in  our 
country,  because  the  area  sold  has  since  proved  itself  to  be  worth  a  good 
deal  more  than  $10,000,000.  Since  1838,  therefore,  the  state  of  Texas 
has  controlled  its  own  land.  It  has  an  enormous  domain  which  was 
set  aside  for  the  benefit  of  the  public  school  fund,  which  now  reaches 
very  nearly  to  the  value  of  $70,000,000.  Nearly  all  of  that  land  has  been 
sold.  I  think  there  now  remains  only  about  one  million  six  hundred 
thousand  acres  of  unsold  public  land  in  Texas.  When  I  went  there 
fourteen  years  ago  there  were  twenty-two  million  acres  unsold,  but  all 
of  that  domain  now  has  been  disposed  of  with  the  exception,  we  will 
say,  of  a  million  and  a  half  acres.  Not  a  foot  of  that  land  has  been 
sold  without  a  reservation  of  mineral  right.  You  cannot  acquire  any 
of  the  public  domain  in  that  state,  nor  has  it  been  possible  for  many 
years  to  do  so,  without  a  reservation  of  the  minerals  that  may  be  found 
on  or  within  that  land.  The  last  legislature  marked  a  radical  departure 
from  the  preceding  methods,  and  it  declared  it  to  be  no  longer  the  policy 
of  the  state  to  part  with  the  mineral  rights  in  its  public  lands.  You 
cannot  now  buy  in  that  state  any  mineral  right  from  the  state;  it  is  all 
on  a  royalty  basis  of  5%  of  the  gross  value  of  the  output  of  minerals 
from  such  land.  It  is  not  an  ad  valorem  tax,  hardly,  nor  a  net  profit  tax, 
it  is  a  gross  value  tax  by  which  the  operator  pays  ^nto  the  state  5% 
of  the  gross  value  of  such  minerals  as  he  may  remove  from  the  public 
land.  That  has  been  in  effect  about  two  years  and  has  not  been  pro- 
ductive of  much  revenue  except  in  case  of  some  isolated  oil  and  gas 
lands  which  the  state  found  it  owned  on  the  Gulf  of  Mexico  and  within 
the  tidewater  limits.  We  have  had  another  interesting  thing  down  there 
in  respect  to  the  conservation  of  mineral  resources,  and  that  has  been 
to  take  a  pair  of  boots  and  grease  them  well  and  put  them  away  in  a 
closet  and  say,  "We  will  conserve  those  boots  for  the  benefit  of  pos- 
terity." (Laughter.)  There  are  some  states,  gentlemen,  which  do  not 
consider  anything  but  the  "reservation"  of  rights  and  do  not  know  what 
conservation  means.  I  would  be  among  the  last  in  this  country  to  de- 
plete any  of  the  natural  resources  or  any  portion  of  them,  but  I  think 
we  are  putting  the  cart  before  the  horse,  and  as  the  horse  has  been 
sufficiently  discouraged  by  the  introduction  of  automobiles,  I  think  we 
ought  to  regard  his  feelings  a  little  more.  It  is  development  that  this 
country  needs,  not  conservation.  (Applause.)  We  need  less  of  the 
spirit  of  saving  and  more  of  the  spirit  of  giving  of  our  time,  our  money, 
and  our  intelligence  to  upbuilding  a  far-sighted,  prudent  and  economic 
nation.  We  do  not  make  a  nation  by  conservation,  gentlemen,  we  make 
a  nation  by  development;  and  that,  I  believe,  is  the  trouble  over  the 


7«  OFFICIAL     PROCEEDINGS 

whole  of  this  beautiful  land  of  ours,  the  lack  of  systematic  and  economic 
development.  When  that  comes  about  we  shall  hear  less  of  conservation, 
because,  as  I  regard  it,  conservation  is  perhaps  a  shorter  term  for  what 
should  be  named  a  wise  development.  We  have  obscured  many  of  the 
important  considerations  that  confront  us  as  a  nation  by  coining  that 
word  "conservation,"  and  it  has  deceived  some  of  the  elect.  (Applause.) 
We  need  a  greater  confidence  in  the  mining  industry  as  an  investment. 
We  ne€d  a  wiser  system  of  development  which  shall  look  not  only  to 
our  own  benefit  but  to  the  benefit  of  those  who  are  so  soon  to  come 
after  us.  I  have  never  had  any  sympathy  for  the  man  who  is  inclined 
not  to  consider  benefits  to  posterity  on  the  plea  that  posterity  had  never 
done  anything  for  him.  (Laughter.)  How  to  bring  about  development 
without  depleting  the  \resources  of  the  country  is  a  matter  demanding 
the  utmost  statesmanship  and  the  most  acute  observation  and  consider- 
ation. Some  years  ago  the  commissioner  of  agriculture  in  the  state  of 
Texas  was  president  of  the  State  Conservation  Association  and  asked 
me  to  speak  beforei  a  convention  of  lumbermen  in  San  Antonio  on  the 
question  of  conservation  of  the  lumber  supply  of  that  state.  I  did  so, 
and  thought  I  made  a  pretty  good  talk,  and  a  lumberman  got  up  and 
said:  "I  would  like  to  ask  you  one  question.  We  have  bonded  our 
lands  for  so  much;  we  have  to  meet  a  certain  rate  of  interest  or  this 
property  goes  into  the  hands  of  the  bondholders.  We  have  got  to  cut 
a  certain  amount  of  timber  every  month.  Now,  how  are  we  going  to 
conserve  the  timber  supply  of  this  state  and  at  the  same  time  meet  our 
fixed  charges  and  bonded  interest?"  I  sat  down.  It  is  beyond  me  how 
to  conserve  a  supply  and  at  the  same  time  use  it — how  to  eat  your  cake 
and  have  it.  I  do  not  believe  that  any  set  of  laws  would  press  equally 
upon  all  of  the  business  of  this  country;  each  thing  has  to  be  considered 
in  and  for  itself.  The  laws  that  apply  to  the  conservation  of  the  anthra- 
cite supplies  of  Eastern  Pennsylvania  do  not  apply  to  the  conservation 
of  oil  in  Oklahoma  or  natural  gas  in  West  Virginia.  If  we  are  to  have 
any  system  of  state  or  national  conservation  that  system  will  have  to 
be  based  upon  local  needs.  I  do  not  know  that  General  Hancock  was 
so  far  wrong,  though  he  was  much  derided  for  it,  when  he  said  the 
tariff  was  a  local  issue.  Events  since  his  day  have  shown  that  the  old 
general,  a  better  soldier  than  politician,  knew  what  he  was  talking 
about  when  he  said  that  it  was  a  local  issue.  Conservation  laws  that 
press  upon  coal  and  oil  supplies  cannot  be  the  same  as  those  which 
press  upon  copper  supplies  or  lead  or  zinc  or  tin  or  whatever  it  may  be. 
I  was  brought  up  in  the  old  school  of  belief  that  the  creation  and  preser- 
vation of  a  body  of  self-respecting,  prudent  and  intelligent  people  in  this 
country  depended  upon  as  little  governmental  interference  with  private 
affairs  as  possible.  (Applause.)  It  is,  in  my  opinion,  the  fundamental 
principle  on  which  we  have  built  this  country  up  to  what  it  is  today. 
There  are  some  things  in  which  the  government  interest  must  be  shown 
and  the  government  money  be  expended,  but,  looking  at  things  by  and 
large,  the  less  we  have  of  governmental  control  in  this  country  the 
greater  is  our  progress  in  all  the  elements  of  good  citizenship.  (Ap- 
plause.) There  are  some  things,  however,  gentlemen,  that  the  govern- 
ment must  do  for  us  because  we  cannot  do  them  for  ourselves.  Now, 
where  that  line  lies  is  for  our  individual  judgment  to  determine.  In 
some  cases  it  may  lip  in  one  direction,  in  some  cases  in  another  direc- 
tion. It  is  impossible  to  say  where  it  shall  lie  in  all  directions.  In  the 
matter  of  looking  into  the  supplies  of  material  within  this  country  as  a 
whole,  the  government  must  do  for  us  what  we  cannot  do  for  ourselves. 
Now,  I  will  take  occasion,  if  you  will  allow  me,  to  point  out  one  thing 
especially  to  you  people  in  the  state  of  Arizona,  continuing  a  few  re- 
marks I  had  the  honor  to  address  to  you  last  night.  It  is  the  fact  that 
the  entire  hope  of  this  part  of  Arizona  is  based  on  the  possibilities  of 
continuous  and  successful  irrigation  of  farm  land  from  the  great  Roose- 


AMERICAN     MINING     CONGRESS  77 

velt  dam.  Is  it  not  so?  The  great  agricultural  hope  of  this  part  of 
Arizona  is  based  upon  the  possibility  of  irrigating  this  beautiful  valley. 
The  same  is  true  of  many  other  valleys  in  Arizona.  You  must  have 
water  in  this  Western  country  as  we  must  have  water  in  the  western 
part  of  my  own  state.  Do  you  know  that  the  surveys,  estimates  and 
calculations  upon  which  the  construction  of  these  great  irrigation  schemes 
is  based  was  made  by  the  United  States  Geological  Survey  and  not  by 
the  United  States  Department  of  Agriculture?  Is  it  not  true?  The 
United  States  Department  of  Agriculture  had  very  little  to  do  with  the 
surveys  on  which  you  people  expect  to  build  an  agricultural  community 
here  at  Phoenix;  that  is  work  that  must  be  done  by  the  general  gov- 
ernment for  the  benefit  of  the  entire  citizenship,  and  it  is  in  this  respect 
— a  very  notable  one — that  we  must  apply  to  the  government  for  aid. 

In  the  adjoining  state  of  New  Mexico  we  see  another  striking  illus- 
tration in  the  great  Elephant  Butte  dam.  All  those  surveys,  all  those 
estimates,  everything  of  the  sort,  was  made  by  the  United  States  Geo- 
logical Survey,  although  not  one  acre  of  that  land  will  ever  come  into 
use  for  geological  purposes.  It  is  all  agricultural.  It  shows  all  the  dif- 
ferent departments  of  the  government  are  intertwined  and  interknit  so 
that  the  work  of  the  Geological  Survey  inures  to  the  benefit  of  the  De- 
partment of  Agriculture  and  to  the  benefit  of  all  of  the  citizens  who 
expect  to  use  that  land  for  farming  purposes.  There  will  not  be  a  foot 
of  land  put  under  use  by  the  Elephant  Butte  dam  that  can  be  used  for 
mining  purposes;  not  one  foot.  It  is  all  agricultural.  And  yet,  as  I 
endeavored  to  point  out  last  night,  this  Survey  and  the  Bureau  of  Mines 
is  actually  starving  to  death  for  lack  of  a  little  money  from  the  general 
government.  It  is  not  to  our  credit  as  a  nation,  gentlemen,  that  we  are 
starving  these  two  great  agencies  for  the  benefit  of  the  entire  population 
of  this  country;  it  is  not  to  our  credit;  it  is,  rather,  more  to  our  shame. 

I  thank  you  very  much  for  the  attention  you  have  kindly  given  to 
these  remarks.  I  had  a  paper  prepared.  I  haven't  said  much  about 
what  is  in  the  paper;  in  fact  it  it  a  very  good  scheme  to  write  a  paper 
and  read  it  to  your  wife  before  you  leave  home.  We  all  do  that.  (Laugh- 
ter.) Poor,  suffering  creature,  she  has  my  sympathy.  (Laughter.)  But 
she  always  says,  "That  is  the  best  thing  you  ever  wrote;"  and  you  get 
all  puffed  up  about  it,  and  come  out  and  measure  yourself  among  men 
of  your  own  size  and  dwindle  down  like  a  balloon  with  a  hole  in  it.  So 
my  paper  is  with  the  Secretary,  and  these  remarks  are  with  you,  with 
my  sincere  gratitude  for  your  kind  patience  and  attention.  (Great  ap- 
plause.) 

Dr.  Phillips'  address  will  be  found  at  page  160  of  this  report. 

THE  PRESIDENT:  Ladies  and  gentlemen,  Dr.  Phillips'  address 
concludes  the  program  for  this  morning,  and  I  think  we  are  very  much 
interested  in  it.  Being  on  the  inside,  I  am  going  to  confess  to  you  that 
Dr.  Phillips'  paper  has  not  been  written.  His  fumbling  around  among  the 
documents  on  the  table  here,  ostensibly  endeavoring  to  find  it,  was  a 
fake.  But  we  are  going  to  have  the  speech  to  which  you  listened  written 
up  and  printed  in  the  minutes  of  the  proceedings  and  you  will  see  it 
later.  He  told  us  about  a  gas  well  spouting  some  fifty  million  feet  a 
day.  I  think  some  very  solid  facts  have  come  out  of  that  gas  well,  and 
we  are  going  to  profit  by  it.  (Laughter.) 

The  session  this  morning  was  called  for  9:30,  and  at  11  we  got 
away.  I  would  ask  you  to  cut  your  lunch  hour  short  and  get  back  here 
at  2,  because  we  have  some  very  interesting  papers  to  listen  to.  Unless 
there  is  something  further  to  come  before  the  meeting  this  morning  we* 
will  now  stand  adjourned  until  2  o'clock. 

Meeting  adjourned. 


78  OFFICIAL     PROCEEDINGS 

WEDNESDAY,  DECEMBER  9,  1914. 
Afternoon  Session. 

2  O'clock  P.  M. 
(Vice  President  Day  in  the  chair.) 

THE  VICE  PRESIDENT:  The  Congress  will  please  come  to  order. 
The  first  business  for  the  afternoon  session  is  the  introduction  of  resolu- 
tions. Has  any  delegate  an  additional  resolution  to  introduce?  If  so, 
he  will  please  convey  it  to  the  Secretary's  desk  where  it  will  be  read 
and  referred  to  the  Committe  on  Resolutions.  Don't  be  bashful,  gentle- 
men; now  is  the  time  to  introduce  those  pet  resolutions  which  you  have 
been  carrying  around  in  your  vest  pockets  for  some  time. 

(Secretary  reads  Resolution  No.  4.) 

RESOLUTION  NO.   3 

(Introduced  by  L.   S.   Judd,   Vicksburgh,  Ariz.) 
Mineral    Land  Within  an    Indian   Reservation. 

Whereas,  A  recent  resurvey  of  the  Colorado  Indian  Reservation  has 
t&ken  in  mineral  land  upon  which  entries  have  been  made  and  work 
prosecuted  for  years  without  protest  on  the  part  of  the  agent  of  the 
reservation,  or  the  Department  of  the  Interior. 

Now,  therefore,  Be  it  Resolved  that  the  Bureau  of  Mines  be  requested 
to  investigate  the  rights  of  the  interested  property  claimants,  to  the  end 
that  intelligent  assistance  may  be  rendered  them  in  such  legislation 
as  may  be  brought  by  their  representatives  in  Congress,  for  their  relief. 

CHAIRMAN  DAY:  This  will  be  referred  without  debate  to  the 
Committee  on  Resolutions. 

(Secretary   reads  Resolution  No.   4.) 

RESOLUTION  NO.   4 
(Introduced  by  Charles  H.  Clapp,  C.  T.  Willis  and  S.  H.  Worrell.) 

Whereas,  The  Congress  of  the  United  States  of  America  has  appro- 
priated at  various  times  the  Morrill  Fund  of  $50,000,  the  Adams  Fund  of 
$20,000,  the  Hatch  Fund  of  $15,000  and  the  Lever  Fund  of  $10,000  yearly 
to  each  state  agricultural  college,  making  a  total  of  $95,000  yearly;  and 

Whereas,  This  money  has  been  spent  to  such  great  advantage  to  the 
farmers  and  the  farming  industry  that  they  are  continuing  to  call  for 
more  money,  that  it  behooves  us  as  representatives  of  the  mining  in- 
dustry; and 

Whereas,  No  money  has  been  appropriated  at  any  time  to  foster 
and  stimulate  instruction  in  mining  subjects  although  approximately  50% 
of  the  above  amounts  are  directly  for  instruction  in  agricultural  sub- 
jects; and 

Whereas,  The  total  aggregate  value  of  agricultural  products  is 
$10,000,000,000  and  the  total  value  of  mineral  products  is  $4,600,000,000 
or  46%;  and 

Whereas,  The  importance  of  the  industry  is  further  reflected  by  the 
fact  that  approximately  60%  of  the  freight  hauled  by  the  railroads  is 
for  the  mining  industry; 

Therefore  be  it  Resolved,  That  we,  as  representatives  of  the  mining 
industry,  ask  the  Congress  of  the  United  States  to  pass  favorably  a  bill 
similar  to  the  Austin  bill  which  provides  that  an  appropriation  of  $25,000 
per  annum  be  made  to  each  mining  school  in  the  United  States. 


AMERICAN     MINING     CONGRESS  79 

CHAIRMAN  DAY:  No  objection  appearing,  it  will  be  referred  to  the 
Committee  on  Resolutions. 

MR.  BASS:  I  would  like  to  ask  if  there  have  been  any  resolutions 
in  relation  to  the  leasing  of  the  public  lands  or  any  discussion  on  that 
subject. 

CHAIRMAN  DAY:  Yes,  there  is  a  paper  here  somewhere  entitled, 
"The  Administration's  Public  Land  Policy,"  by  John  F.  Shafroth,  sena- 
tor from  Colorado.  As  I  understand  it,  that  is  one  of  the  orders  of  busi- 
ness this  afternoon. 

(Secretary  reads  Resolution  No.  5.) 

RESOLUTION  NO.   5 
(Introduced  by  Dr.  William  B.  Phillips  and  Mr.  R.  C.  Allen.) 

Resolved,  That  the  American  Mining  Congress  respectfully  urges 
the  Congress  of  the  United  States  to  pass  during  its  present  session  in 
Washington  the  bills  now  pending  before  both  the  Senate  and  the  House 
which  provide  for  the  establishment  of  mining  experiment  stations  and 
mine  safety  stations  looking  to  a  reduction  of  the  hazards  and  the  wastes 
of  resources  in  the  mining,  metallurgical  and  other  mineral  industries; 

That  the  American  Mining  Congress  also  respectfully  petitions  that 
in  the  enactment  of  this  legislation  the  number  of  mining  experiment 
stations  be  increased  from  ten,  as  provided  for  in  the  pending  bills,  to 
fifteen,  which  larger  number  is  still  less  than  one-third  the  number  of 
agricultural  experiment  stations  already  established  and  maintained  from 
the  national  treasury. 

Resolved,  That  the  President  of  the  American  Mining  Congress  ap- 
point a  committee  of  three  persons  in  each  of  the  states  to  co-operate 
with  the  Secretary  of  the  American  Mining  Congress  and  a  special  rep- 
resentative, also  to  be  appointed  by  him,  in  Washington,  in  securing  the 
enactment  during  the  present  session  of  Congress  of  the  bills  now  pend- 
ing before  the  Senate  and  the  House  of  Representatives,  which  provide 
for  the  establishment  of  mining  experiment  stations  and  mine  safety 
stations  in  the  more  important  mining  regions  of  the  country. 

CHAIRMAN  DAY:  No  objection  appearing,  the  resolution  will  be 
referred  to  the  Resolutions  Committee. 

MR.  SWART:     I  would  like  to  submit  two  resolutions. 

RESOLUTION  NO.  6 
(Introduced  by  W.  G.  Swart  of  Colorado.) 

Resolved,  That  the  American  Mining  Congress,  recognizing  the  ne- 
cessity of  carrying  forward  the  movement  for  greater  safety  in  mining, 
places  itself  hereby  on  record  as  in  favor  of  the  earliest  possible  adoption 
of  a  uniform  national  system  of  bell  and  danger  signals. 

RESOLUTION  ON.   7 
(Introduced  by  W.  G.  Swart  of  Colorado.) 

In  view  of  the  humanitarian,  as  well  as  the  metallurgical  interest  and 
importance  attached  to  radium  investigations,  the  American  Mining 
Congress  urges  the  Congress  of  the  United  States,  now  assembled  in 
Washington,  to  provide  the  necessary  appropriation  and  authority  to 
enable  the  Department  of  the  Interior  to  purchase  a  supply  of  radium 
ores  and  to  carry  forward  its  metallurgical  investigations  at  least  to 
such  extent  as  may  be  necessary  to  demonstrate  the  lower  cost  of  pro- 
ducing radium  and  other  rare  metals  found  in  the  public  land  states 
and  to  supply  a  sufficient  quantity  of  radium  to  meet  the  needs  of  the 
government  hospitals. 


SI  OFFICIAL     PROCEEDINGS 

MR,  CLARK:  I  will  ask  that  these  resolutions  be  referred  to  the 
Resolutions  Committee. 

CHAIRMAN  DAY:     No  objection  appearing,  it  is  so  ordered. 
The  next  on  the  program  is  an  address  by  the  chairman  of  the  Com- 
mittee on  Alaskan  Legislation,  Mr.  Falcon  Joslin,  Fairbanks,  Alaska. 

SECRETARY  CALLBREATH:  Mr.  Chairman,  I  have  Mr.  Joslin's 
communication.  It  is  rather  long,  somewhat  in  the  nature  of  an  ad- 
dress, outlining  the  present  conditions  in  Alaska,  describing  the  legis- 
lation with  reference  to  the  construction  of  railroads  and  the  leasing 
of  coal  in  Alaska  and  so  on.  It  is  so  long  that  I  would  suggest  that  we 
read  it  by  title,  and  all  of  our  members  will  have  an  opportunity  a  little 
later  to  read  it  in  the  proceedings  of  the  Congress. 

CHAIRMAN  DAY:  No  objection  appearing,  it  will  be  so  ordered. 
The  Secretary  will  please  read  the  address  by  title.  (See  page  153.) 

If  Mr.  Clapp  is  now  ready  to  deliver  his  address  we  will  be  very  glad 
to  hear  from  him. 

Mr.  Clapp's  address  will  be  found  at  page  177  of  this  report. 

CHAIRMAN  DAY:  The  next  paper  on  the  program  is  one  entitled 
"The  Federal  Control  of  the  Water  Power  of  the  West,"  by  Hon.  E.  A. 
Wedgewood  of  Salt  Lake  City,  Utah.  As  Mr.  Wedgewood  is  not  witk 
us,  the  paper  will  be  read  by  title  by  the  Secretary  and  passed. 

SECRETARY  CALLBREATH:  The  paper  has  been  printed  and 
passed  around.  (See  page  181.) 

CHAIRMAN  DAY:  The  next  on  the  program  is  the  report  of  the 
Committee  on  "Workmen's  Compensation,"  by  Mr.  Samuel  A.  Taylor  of 
Pittsburgh,  Pennsylvania. 

Report  of  Committee  on   Workmen's  Compensation. 

To  the  American  Mining  Congress: 

Gentlemen — Your  Committee  on  Workmen's  Compensation  has  not 
had  a  meeting.  The  reason  for  this  is  as  follows:  There  were  a  num- 
ber of  states  that  had  under  consideration  the  compilation  of  workmen's 
compensation  bills  to  be  presented  to  the  next  session  of  their  legislature. 
The  chairman  having  this  in  mind  tried  to  secure  some  information  on 
these  proposed  bills,  and  also  tried  to  secure  copies  of  all  compensation 
laws  now  in  force  in  the  various  states,  which  number  24,  as  well  also 
any  suggestions  for  changes  thereto  resulting  from  the  experience 
gained  in  the  operation  of  said  laws.  The  purpose  of  these  inquiries 
were  so  that  we  could  examine  these  various  laws,  tabulate  the  essential 
points  of  the  laws  which  were  in  common  and  also  to  note  the  points 
in  which  they  differed.  This  information  was  not  secured  from  all  the 
states  and  those  which  were  received  were  not  received  in  time  to  per- 
mit the  chairman  to  tabulate  the  points  he  had  in  mind  so  that  the 
time  of  the  committee  would  be  saved,  and  get  the  committee  together 
for  action  thereon.  The  result  therefore  is  that  this  brief  report  is  the 
report  of  the  chairman  rather  than  the  committee  as  a  whole,  and  is  only 
a  brief  report  of  progress. 

In  response  to  a  question  asked  from  each  state  as  to  the  operation 
of  their  compensation  laws,  almost  the  universal  reply  was  that  it  is 
working  very  well,  although  in  some  cases  they  have  certain  changes 
which  they  propose  to  their  present  law  in  order  to  render  it  more 
effective.  This  is  no  doubt  due  to  the  fact  that  most  any  law  where  a 
fixed  amount  and  an  exact  method  of  providing  such  compensation  is 
a  great  improvement  over  the  old  method  of  collection  by  suit  at  law, 
in  which  case  the  party  entitled  to  and  receiving  compensation  was  often 
deprived  of  a  large  amount  of  what  was  paid  by  the  employer. 


AMERICAN     MINING     CONGRESS  81 

In  several  states  specific  changes  are  under  consideration  which 
will  make  the  law  more  simple,  fairer  and  surer  in  its  operation,  and  in 
several  other  states  that  have  had  their  compensation  acts  in  force  long 
enough  to  show  their  shortcomings  and  to  have  the  acts  amended  by  the 
legislatures  of  the  states,  have  already  amended  them  to  a  good  ad- 
vantage. 

I  wish  to  say  that  so  far  as  I  have  examined  into  these  acts,  there 
is  very  little  in  the  amended  acts  that  is  much  of  an  improvement  over 
the  proposed  act  recommended  by  a  former  committee  of  the  Mining 
Congress. 

Two  features  of  all  the  laws  passed  are  well  worth  while  to  con- 
sider, by  all  those  states  contemplating  the  passage  of  a  compensation 
law.  First,  that  so  nearly  as  possible  in  all  states  uniform  tables  of 
compensation  be  secured,  or  in  other  words,  if  a  uniform  percentage  of 
wages  for  a  uniform  period  of  time  could  be  secured  then  a  much  better 
and  fairer  comparison  of  the  different  acts  can  be  compiled. 

The  State  of  Wisconsin  has  made  a  comparison  of  the  laws  of  some 
ten  states  in  the  bulletin  of  the  Industrial  Commission,  Vol.  1,  No.  3, 
dated  July  20,  1912,  and  by  reference  thereto  will  be  seen  at  once  how 
much  a  uniform  amount  of  compensation  is  needed. 

The  other  question  is  the  method  of  collecting  the  compensation. 
The  question  of  the  compensation  being  compulsory  or  elective,  and 
also  the  question  of  a  prompt  and  economical  method  of  administering 
the  fund. 

In  connection  with  this  second  question,  it  seems  very  apparent 
that  it  is  desirable  for  all  companies,  large  and  small,  engaged  in  the 
same  business  to  be  obliged  to  come  under  the  compensation  act  on 
exactly  the  same  terms,  for  otherwise  an  unbalanced  condition  will  exist 
which  may  work  out  to  the  detriment  of  the  small  or  independent  com- 
pany as  against  the  large  company  or  combination  of  companies,  both 
in  the  way  of  securing  employes  and  as  to  the  cost  of  said  compensation. 
For  example,  suppose  a  large  coal  company  operating  many  mines  had 
an  explosion  in  one  of  their  mines,  where  a  number  of  men  were  killed. 
This  large  company  carrying  its  own  risk  might  be  able  to  pay  all  of  the 
claims  under  a  compensation  law,  while  if  the  same  accident  would 
happen  to  a  company  owning  only  the  one  mine  where  the  explosion 
took  place,  would  not  have  sufficient  capital  to  pay  the  amount  of  com- 
pensation stipulated  in  the  law,  for  all  the  deaths  which  occurred  in  said 
explosion.  The  result  of  such  an  accident  would  probably  mean  the 
bankrupting  of  the  small  company  and  in  addition  to  this  the  men  en- 
gaged in  this  industry  would  thereafter  seek  employment  in  the  larger 
or  stronger  companies  and  would  only  work  for  the  smaller  company 
when  they  could  not  obtain  work  with  the  larger  companies,  and  thus 
work  to  the  detriment  of  the  small  companies.  A  uniform  and  compul- 
sory compensation  law  would  overcome  this  by  all  paying  the  same 
proportional  amount,  and  would  also  place  all  companies,  regardless 
of  size,  on  a  parity  in  the  matter  of  operation.  Furthermore,  the  cost  of 
said  compensation  being  uniform  would  be  easily  estimated  as  part  of 
the  cost  of  production  and  added  thereto,  and  thus  the  consumer  would 
pay  for  it  in  the  end,  which  I  believe  is  only  fair. 

If  such  a  uniform  basis  can  be  formulated  for  all  the  states,  I  am 
sure  compensation  laws  will  become  more  popular  and  desirable. 

Finally,  examination  of  these  reports,  so  far  as  I  have  been  able 
to  study  them,  seems  to  bear  out  the  fact  that  where  all  employers  are 
classified  into  groups  according  to  the  hazard  of  the  employment,  a 
uniform  assessment  made  and  all  employers  and  employes  obliged  to 
come  under  the  law,  a  much  better  feeling  exists  between  the  employers 
and  employes.  A  great  improvement  is  also  experiencd  over  the  old 


82  OFFICIAL     PROCEEDINGS 

method  of  settling  the  claims  for  accidents  and  the  common  weal  is  ad- 
vanced by  having  fewer  paupers  or  persons  dependent  on  charity. 

The  work  of  the  Mining  Congress  along  this  line  now  seems  to 
have  reached  a  point  where  it  should  advocate  nation-wide  compensation 
laws,  uniform  in  the  percentage  of  the  wages  paid  to  employes  or 
their  dependents  and  also  as  to  the  method  of  collection  and  adminis- 
tration. And  if  \it  were  possible  to  have  a  national  law  applying  to 
all  states  alike  this  would  be  very  desirable,  but  inasmuch  as  a  national 
law  oannot  under  the  present  status  of  governmental  affairs  be  appli- 
cable, it  is  very  desirable  to  work  to  the  end  of  securing  a  uniform  basis 
for  compensation  laws  in  all  states. 

This  seems  to  me  to  be  the  special  work  of  the  Mining  Congress  at 
the  present  time. 

Respectfully  submitted  S.  A.  TAYLOR, 

Chairman   Compensation   Committee. 

CHAIRMAN  DAY:  Gentlemen,  what  is  your  pleasure  with  regard 
to  the  report  of  the  Compensation  Committee?  Discussion  is  now  in 
order.  If  no  remarks  are  forthcoming  the  paper  will  be  accepted  and 
placed  on  file. 

The  next  on  the  program  is  "The  Law  and  Compulsory  Arbitration," 
by  Hon.  James  A.  Emery  of  Washington,  D.  C. 

Mr.  Emery's  paper  will  be  found  at  page  227  of  this  report. 

SECRETARY  CALLBREATH:  I  would  like  to  say  that  we  made 
our  very  best  effort  to  provide  a  complete  discussion  of  this  subject. 
It  would  seem  that  the  enormous  waste  occasioned  and  the  bad  feeling 
engendered  by  labor  strikes,  to  say  nothing  of  the  loss  of  life,  which 
amounts  to  crime  in  many  instances,  call  for  the  action  of  an  organiza- 
tion which  has  as  one  of  its  primary,  basic  purposes,  the  bringing  about 
of  the  highest  efficiency.  I  have  corresponded  with  leaders  on  the  various 
sides  who  might  be  expected  to  have  decided  opinions  on  the  question 
of  compulsory  arbitration,  asking  them  to  present  papers  or  to  appear 
here  and  discuss  this  subject.  I  have  not  been  able  to  find  anyone, 
either  upon  the  side  of  the  laborer  or  of  the  employer,  who  is  willing  to 
unqualifiedly  say  that  he  favors  any  system  of  compulsory  arbitration. 
From  |the  standpoint  of  the  operator  it  is  urged  that  the  award  could 
not  be  enforced  against  the  worker  because  of  the  fact  that,  while  it 
might  prohibit  a  combined  going  out  of  the  help,  it  could  not  possibly 
prohibit  the  ceasing  of  work  by  any  individual.  On  the  other  hand,  the 
laboring  people  insist  that  compulsory  arbitration  would  be  absolutely 
destructive  of  the  independence  of  the  American  working  man.  At  the 
time  the  Chicago,  railway  strike  was  impending  and  the  efforts  by  the 
President  of  the  United  States  were  being  made  to  have  the  dispute 
adjusted  and  referred  to  arbitrators,  it  was  stated  to  me  by  a  very  high 
public  official,  who  was  also  a  representative  of  labor,  that  in  case  there 
should  be  a  tie-up  of  the  traffic  of  the  United  States  for  a  period  of 
ten  days  nothing  under  the  sun  could  prevent  the  enactment  of  laws 
requiring  arbitration  of  labor  disputes  in  such  cases.  It  would  seem 
that  in  cases  of  concerted  action  to  stop  the  passage  of  traffic,  which 
would  practically  put  the  larger  cities  of  our  country  on  a  starvation 
basis,  that  the  public  has  rights  which  should  be  recognized.  It  would 
seem  that  there  should  be  some  method  by  which  disputes  could  be 
settled  in  those  lines  of  business  which  directly  affect  the  public.  It 
seemed  to  those  of  us  who  prepared  the  program  for  this  meeting  that 
even  though  we  might  not  at  this  meeting  accomplish  anything,  we 
might  at  least  bring  to  the  front  a  question  which  is  bound  to  be  a  vital 
question  in  the  future.  I  do  not  believe  that  under  the  conditions  in  this 
country  as  they  now  are  we  can  afford  the  enormous  waste  which  is 
consequent  upon  industrial  strikes,  and  other  countries  have  shown  us  a 


AMERICAN     MINING     CONGRESS  83 

way  by  which  a  greater  part  of  these  losses  can  be  avoided.  The  papers 
which  are  presented  are  intensely  interesting,  and  I  do  not  know 
whether  this  audience  would  care  to  have  them  presented  or  not,  but 
I  have  made  this  preliminary  statement  with  this  thought  only,  that  we 
ought  to  start  a  movement  looking  to  the  elimination  of  that  enormous 
waste  and  bitterness  and  crime  which  often  follows  a  bitter  dispute 
between  employer  and  employe.  We  are  all  alike  in  one  respect — when 
we  get  into  a  contest  we  do  not  stop  to  ask  whether  the  club  at  hand  has 
a  blaqk  end  or  not,  we  take  it  and  strike.  When  labor  disputes  come 
things  are  generally  done  which  those  guilty  of  the  infractions  of  the  laws 
do  not  attempt  even  to  justify.  I  am  wondering  whether  this  convention 
is  large  enough  to  undertake  the  beginning  of  a  movement  looking  to 
a  betterment  of  these  conditions. 

CHAIRMAN    DAY:      The   next   paper   on   the   program    is    entitled 
"Compulsory  Arbitration,"  by  Mr.   Samuel   O.  Dunn  of  Chicago. 
Mr.  Dunn's  paper  will  be  found  at  page  230  of  this  report. 

SECRETARY  CALLBREATH:  I  would  like  to  have  a  suggestion 
from  somebody  in  the  convention  or  from  a  number  of  those  in  the 
convention  as  to  whether  it  would  not  be  wise  for  the  American  Mining 
Congress  to  appoint  a  committee  to  investigate  this  general  subject  with 
a  view  of  reporting  at  a  later  convention  or  back  to  the  Mining  Congress 
as  to  whether  or  not  any  remedy  for  the  existing  conditions  can  be 
brought  about. 

CHAIRMAN  DAY:  Gentlemen,  you  have  heard  the  suggestion  of 
Secretary  Callbreath.  What  is  your  pleasure  in  regard  to  it?  It  seems 
to  be  a  matter  well  within  the  province  of  this  Mining  Congress.  The 
question  of  the  relations  between  capital  and  labor  is  an  acute  one  in  the 
various  parts  of  the  country.  No  discussion  apparently  being  forth- 
coming,— 

MR.  DOUGLAS:  Mr.  Chairman,  with  reference  to  this  matter  of 
compulsory  arbitration,  it  seems  it  should  be  confined  at  the  present 
time  to  industries  which  furnish  the  necessaries  of  life.  Possibly  these 
would  include  only  transportation,  and  so  far  as  the  mining  industry  is 
concerned,  the  production  of  fuels.  These  two  commodities  the  public 
cannot  get  along  without.  The  question  as  to  the  successful  working  of 
compulsory  arbitration,  I  think,  is  very  doubtful,  when  it  is  applied  to 
what  either  the  employer  or  the  employe  might  consider  his  "honor." 
We  run  up  against  the  same  stone  wall  that  the  international  arbitration 
treaties  have  encountered.  The  question  of  "honor"  in  the  mining  in- 
dustry as  between  the  employer  of  labor  and  the  workman  resolves 
itself  generally  into  a  question  of  the  recognition  or  the  non-recognition 
of  the  union.  Now,  whether  a  matter  of  that  kind,  whether  a  question 
of  recognition  can  be  left  to  arbitration,  is  the  most  important  one.  I 
think  there  are  very  few  cases  in  which  we  have  had  any  serious  labor 
difficulties  in  this  country  where  the  union  question  was  not  the  principal 
one  in  dispute;  and  therefore  I  do  not  believe  that  it  is  well  to  dismiss 
this  subject  without  full  consideration,  and  in  accordance  with  the  recom- 
mendation of  the  Secretary  I  move  that  a  committee  be  appointed  by  the 
Chair  to  consider  this  matter  and  to  report  at  the  next  general  meeting 
of  the  Congress. 

(Motion   seconded.) 

MR.  HULL:  Mr.  Chairman,  two  years  ago  I  had  the  pleasure  of 
being  at  the  meeting  of  the  National  Civic  Federation.  Twenty-five  of 
us  were  on  that  committee.  We  took  up  this  same  proposition,  which 
we  supposed  would  do  the  work  which  you  are  attempting  to  do  now. 
In  all  the  resolutions  I  took  an  active  part,  and  when  we  went  into  the 
convention  they  were  accepted,  and  they  were  as  good  a  set  of  resolutions 


S4  OFFICIAL     PROCEEDINGS 

as  were  ever  gotten  up  any  place  in  the  United  States.  There  may  be 
some  gentlemen  here  that  were  there  on  that  occasion.  I  was  asked 
to  go  if  I  could,  and  I  went  there,  and  we  agreed  upon  some  propositions, 
but  those  propositions  have  not  been  entirely  worked  out. 

Now,  in  regard  to  arbitration,  of  course  that  comes  under  our  own 
constitutions.  In  adopting  these  resolutions  you  could  not  go  to  work 
and  adopt  arbitration  measures  without  they  should  be  prescribed  by 
the  laws  of  your  state,  and  I  hope  that  they  can  be.  I  hope  something 
could  be  done  that  would  bring  us  all  together,  the  workman  as  well 
as  the  mining  man.  I  think  if  we  did  appoint  some  men  we  might, 
through  the  efforts  of  this  Congress,  do  many  things  that  would  be  for  the 
benefit  of  the  mining  men,  the  laborer  and  the  companies  that  employ 
them. 

CHAIRMAN  DAY:  We1  would  like  to  hear  from  another  gentleman 
whq  has  views  to  submit  on  this  question.  The  motion  is  before  the 
house.  Are  you  ready  for  the  question.  (Question  called  for.) 

SECRETARY  CALLBREATH:  Mr.  Chairman,  would  it  not  be  wise 
to  extend  the  authority  of  this  proposed  committee  to  cover  not  only 
compulsory  arbitration  but  mediation  and  conciliation,  so  that  if  it  were 
found  that  compulsory  arbitration  is  impracticable  at  this  time,  it  could 
recommend  means  through  which  mediation  and  conciliation  can  be 
made  more  effective.  Much  has  been  done  already  in  that  direction,  but 
there  is  much  more  to  do.  I  would  suggest  that  the  resolution  be  so 
framed  that  the  committee  would  have  full  authority  to  go  into  any 
means  through  which  industrial  disputes  might  be  settled  in  some  other 
way  than  by  strikes. 

MR.    DOUGLAS:      I   accept  the   Secretary's   modification. 

CHAIRMAN  DAY:  The  widening  of  the  scope  of  the  motion  has 
been  accepted  by  the  author.  Is  it  agreeable  to  the  second? 

MR.  DELEGATE:     It  is. 

CHAIRMAN  DAY:  A  motion  has  been  made  and  seconded  that  a 
committee  be  appointed  to  consider  the  question  of  compulsory  arbitra- 
tion, mediation  and  conciliation,  and  to  report,  as  I  understand  it,  at  the 
next  meeting  of  the  Mining  Congress.  Is  that  your  idea,  Mr.  Douglas? 

MR.  DOUGLAS:     Yes. 
(Motion  carried  unanimously.) 

CHAIRMAN  DAY:  The  chair  will  take  the  appointment  under  ad- 
visement in  the  absence  of  the  president,  Mr.  Scholz,  and  the  appoint- 
ments on  the  committee  will  be  announced  later. 

Has  any  delegate  anything  further  to  submit? 

SECRETARY  CALLBREATH:  Mr.  Chairman,  there  seems  to  be 
nothing  further  upon  the  program  this  afternoon  except  the  consider- 
ation of  the  report  of  the  Resolutions  Committee.  I  would  suggest  that 
if  the  people  here  are  anxious  to  see  the  Arizona  mineral  exhibit,  as  I 
have  no  doubt  many  of  them  are,  after  calling  upon  the  Resolutions 
Committee  to  report  what  business  they  have  agreed  upon,  and  its 
consideration,  we  might  adjourn  in  order  to  give  the  delegates  present 
an  opportunity  to  see  that  exhibit. 

MR.  CARMICHAEL:  The  Resolutions  Committee  would  prefer  to 
wait  until  tomorrow  morning  to  make  its  report.  We  have  no  resolutions 
ready  to  report  at  this  moment. 

CHAIRMAN  DAY:  No  further  business  appearing,  an  adjournment 
will  be  taken  until  tomorrow  morning,  and  the  meeting  at  that  time  is 
supposed  to  be  taken  up  largely  by  discussion  of  the  resolutions.  I 


AMERICAN     MINING     CONGRESS  85 

wonder  if  it  would  not  be  well  for  us  at  this  time  to  take  up  a  discussion 
which  was  scheduled  for  tomorrow  morning  on  the  subject  of  "What  Is 
the  Matter  With  Mining?"  which  was  to  be  led  by  Mr.  Knight  of  Utah. 
I  think  it  rests  with  the  convention  which  they  would  prefer  to  do. 

MR.  SWART:  Mr.  Chairman,  I  move  that  we  take  up  that  discus- 
sion and  let  us  have  it  out. 

CHAIRMAN  DAY:  We  are  fortunate  in  having  Mr.  Jesse  Knight  of 
Utah  with  us,  who  will  lead  this  discussion. 

Mr.  Knight's  address  will  be  found  at  page  150  of  this  report. 

CHAIRMAN  DAY:  I  am  sure  we  have  all  been  very  much  edified 
by  the  remarks  of  Mr.  Knight.  I  know  of  no  one  in  the  mining  business 
better  qualified,  by  reason  of  wide  experience  and  good  judgment,  to 
express  the  sentiments  of  the  miners  of  the  West.  We  would  like  to 
hear  from  others.  (After  a  pause.)  If  we  don't  get  more  muck  we  will 
have  to  put  in  the  shot  and  shake  up  this  hard  formation.  Mr.  Secre- 
tary, I  would  suggest  that  you  call  the  roll  of  the  states,  and  we  will 
ask  the  delegates  to  respond  by  states. 

SECRETARY  CALLBREATH:     The  first  on  the  list  is  Arizona. 

CHAIRMAN  DAY:  Who  will  tell  us  what  is  the  matter  with  min- 
ing in  Arizona? 

MR.  JOSIAH  BOND  of  Arizona:  Mr.  President!  I  am  a  prospector 
residing  in  Arizona.  I  think  I  can  tell  you  one  of  the  things  that  is  the 
trouble  with  mining.  My  general  view  has  been  well  expressed  by  the 
gentleman  from  Texas,  Dr.  Phillips.  He  remarked  that  they  didn't  have 
such  an  awful  lot  of  mineral  production  in  Texas,  but  what  they  lacked 
in  production  they  made  up  in  legislation.  Now,  we  can  beat  Texas  a 
hundred  to  one  in  mineral  production,  I  suppose,  but  we  can  beat  them 
a  thousand  to  one  on  legislation.  That  is,  to  my  mind,  one  of  the  most 
serious  troubles  of  the  present  day,  not  only  with  mining  but  every 
other  form  of  business,  what  I  might  call,  tinkering  with  legislation. 
Unfortunately  in  the  last  six  or  seven  years  we  have  had  dull  times, 
and  a  lot  of  people  have  been  let  loose  to  think  up  something  to  worry 
the  rest  of  us  with,  and  they  have  succeeded  in  doing  it  pretty  well. 
These  laws  are  probably  well  meant;  at  least  they  are  not  proposed  by 
vicious  people.  I  know  many  people  in  my  own  voting  precinct  (where 
almost  every  one  of  these  laws  carried),  and  they  are  all  good  people, 
and  lots  of  them  are  my  friends.  They  vote  against  their  own  interests 
many  times,  because  I  believe  they  do  what  the  ordinary  man  does 
under  some  kind  of  atavistic  law — they  follow  the  leader,  and  when  the 
bell-sheep  runs  off  they  run  off  with  him,  and  when  somebody  proposes 
a  law  they  don't  want  to  be  disagreeable  about  it,  and  having,  they 
think,  nothing  at  stake,  they  say,  "All  right." 

Now  I  have  a  few  claims  and  I  have  been  trying  to  sell  them,  or 
some  of  them  for  a  long  time,  but  I  can't  do  it;  but  whenever  I  can  I 
lease  them.  I  have  one  or  two  claims  now  leased  to  a  man  who  is  a 
great  union  labor  man.  I  can  tell  you  a  little  incident  about  him  that 
I  think  will  illustrate  the  present  condition  pretty  well.  He  is  not  only 
a  great  union  labor  man,  but  he  is  also  a  Socialist  of  the  most  advanced 
German  type,  and  he  was  boasting  to  me — I  might  even  say  he  was 
bragging  to  me — that  at  the  present  time  in  the  State  of  Arizona  the 
condition  of  the  laboring  man  in  the  eyes  of  the  law  was  the  best  that 
ever  was  in  the  world  (and  I  was  inclined  to  agree  with  him),  but 
shortly  afterwards  in  the  same  conversation  he  admitted  to  me  that  it 
was  the  hardest  he  had  ever  known  in  his  own  history,  the  hardest  time 
for  a  man  to  get  a  job.  Now,  don't  you  see  that  the  two  go  together? 
When  people  try  to  produce  legislation  for  their  benefit  only,  and  at  the 
expense  of  the  rest  of  the  community  they  get  the  rest  of  the  com- 


86  OFFICIAL     PROCEEDINGS 

munity  a  little  frightened.  Sooner  or  later  they  will  get  them  thoroughly 
frightened  and  then  they  back  off  and  they  refuse  to  go  into  anything. 
Well,  that  is  the  result  in  mining  right  here  in  Arizona.  We  cannot 
raise  money  for  perfectly  legitimate  and  good  schemes  in  mining  or  in 
any  other  way  simply  because  the  people  are  afraid  of  what  is  going 
to  come  next. 

Now,  of  course,  most  of  this  legislation  has  been  poorly  thought  out. 
We  adopted  at  the  last  election  in  this  state  what  was  known  as  an 
anti-blacklist  law,  which  provides  that  you  must  not  ask  any  questions 
of  a  man  when  you  hire  him.  This  was  initiated  by  the  labor  men,  I 
suppose.  At  the  last  minute  the  labor  men  in  Tucson  concluded  that 
they  would  vote  against  it,  because  they  discovered  that  it  might  knock 
out  the  union  shop  altogether.  If  you  could  not  ask  a  man  any  questions, 
or  whether  he  belonged  to  a  union,  how  in  the  world  could  you  have  a 
union  shop?  This  is  what  I  mean  by  saying  the  legislation  is  not  well 
thought  out,  and  does  not  help  the  ones  in  whose  supposed  interest  it 
is  passed.  They  have  not  had  good  advisers  in  suggesting  the  legisla- 
tion and  it  is  what  we  might  call  half-baked,  and  this  is  troubling  not  only 
the  mining  industry,  but  every  other  business  in  the  United  States. 

The  people  have  gotten  into  that  state  of  mind  where  they  are 
willing  to  try  all  sorts  of  experiments,  and  I  think  this  Congress  ought 
to  go  on  record  against  that  sort  of  experimentation.  We  do  not  need 
it.  For  example,  we  have  proposed  a  resolution,  which  will  be  presented 
here  tomorrow  for  us  to  vote  upon,  urging  a  change  in  the  law  in  regard 
to  mining  locations.  As  a  prospector  I  do  know  something  about  that 
question,  and  I  am  willing  to  admit  right  now  that  probably  the  man 
who  proposed  that  law  in  the  first  place — Senator  Stewart,  wasn't  it? — 
if  he  had  known  how  our  deposits  were  going  to  be  found  in  later  years, 
couldn't  have  proposed  any  law  that  would  have  been  worse.  But  the 
Supreme  Court  of  the  United  States  and  all  the  other  courts  in  all  the 
mining  states  of  the  Union  have  threshed  away  at  the  law  until  they 
have  reduced  it  to  some  kind  of  intelligible  terms,  so  that  the  ordinary 
man  understands  it.  Now,  when  I  propose  to  men  to  go  into  prospects 
with  me  they  want  to  know  under  what  kind  of  a  title  I  hold  them  and 
what  kind  of  security  I  can  give  them  that  the  law  will  be  the  same  in 
the  course  of  a  year  or  two  from  now  as  it  is  today.  Of  course  I  cannot 
give  such  assurance,  nor  can  anybody  else  for  that  matter,  but  I  want 
to  go  on  record  here  as  opposed  to  all  changes  in  the  law  which  are  not 
demonstrated  to  be  absolutely  necessary. 

I  was  a  strong  silver  man  in  1896.  I  can  prove  to  every  man  in  this 
house  that  the  free  and  unlimited  coinage  of  silver  at  the  ratio  of  six- 
teen to  one  is  entirely  correct.  Yes,  sir.  But  the  inexorable  logic  of 
events  has  been  against  the  proposal.  Lots  of  bills  that  are  perfectly 
right  theoretically,  when  you  come  to  put  them  into  practice  are  all 
wrong.  There  has  been  some  talk  about  the  causes  of  the  war  in 
Europe.  I  believe  that  the  microbe  of  experimentation  has  gone  around 
the  world,  and  the  great  German  people,  who  pride  themselves  upon  the 
great  improvements  they  have  made  in  everything,  upon  their  superior 
kultur,  and  above  all  upon  their  efficiency,  with  this  microbe  working, 
had  to  do  something  to  change  the  situation,  and  they  thought  they 
would  change  it  completely  while  they  were  at  it.  (Laughter.) 

This  is  the  idea  I  want  to  impress  upon  you:  I  think  this  Congress 
ought  to  go  upon  record — it  is  an  important  body  of  men,  gathered  from 
all  over  the  United  States — and  I  say  it  ought  to  go  upon  record  in 
warning  the  people  against  this  tinkering  with  the  laws  when  it  is  not 
necessary,  and  when  there  is  no  good  to  be  derived,  even  from  what 
looks  on  the  face  of  it  like  a  theoretically  good  thing.  Now,  I  don't 
know  whether  I  have  made  myself  plain  to  you  or  not,  but  I  hope  I 
have,  because  I  feel  very  strongly  about  it,  and  I  feel  that  I  am  right 
about  it,  too.  I  thank  you  for  your  attention.  (Applause.) 


AMERICAN     MINING     CONGRESS  87 

CHAIRMAN  DAY:  I  am  sure  we  are  all  glad  to  hear  from  Mr.  Bond 
on  the  subject  near  to  his  heart.  It  strikes  a  responsive  chord  with 
lots  of  us,  I  am  sure,  and  we  appreciate  his  suggestion  looking  toward 
a  resolution  of  some  suitable  protest  against  this  mania  or  hysteria  for 
some  new  legislation  to  which  he  so  feelingly  refers. 

MR.  McALPINE  of  Oklahoma:  Mr.  Chairman,  I  am  a  little  out  of 
order  on  account  of  having  to  leave  in  a  few  minutes  to  attend  a  com- 
mittee meeting.  I  want  to  say  that  I  have  enjoyed  every  minute  of  my 
stay  in  the  state  and  also  in  the  City  of  Phoenix.  I  have  also  enjoyed 
and  profited  by  what  has  been  said  in  this  convention;  but  inasmuch 
as  I  come  from  a  coal  mining  state  and  there  has  been  little  said  along 
coal  lines  here,  I  am  somewhat  disappointed. 

I  regret  that  those  who  were  on  the  program  to  speak  on  the  sub- 
jects of  "Compulsory  Arbitration"  and  "Workmen's  Compensation"  are 
unable  to  be  here  and  discusss  them.  I  have  remained  perhaps  a  day 
longer  than  I  would  have  done  had  I  know  they  would  not  be  here.  We 
are  meeting  these  problems  in  Oklahoma,  and  you  are  going  to  meet 
them,  and  whether  we  like  it  or  not  they  must  be  confronted.  At  the 
coming  legislature  in  Oklahoma  it  is  almost  certain  that  a  workmen's 
compensation  bill  will  be  brought  before  that  body  for  passage.  There 
have  been  workmen's  compensation  bills  proposed  at  different  times 
and  I  am  sure  that  at  the  coming  session  of  the  legislature  an  attempt 
will  be  made  to  pass  such  a  law. 

I  am  interested  in  this  subject  and,  having  a  large  number  of  men 
in  my  employ,  I  realize  the  need  of  having  a  law  of  this  kind.  I  am  a 
believer  in  a  compensation  law  and  I  hope  one  can  be  passed  that  will 
be  just  and  fair  to  all  concerned.  I  had  hoped  that  this  subject  would 
be  discussed  from  all  viewpoints  and  that  I  would  be  able  when  I  re- 
turned home  to  offer  suggestions  that  would  be  for  the  good  of  the  cause 
all  along  the  line. 

In  a  state  where  you  have  laws  such  as  were  mentioned  this  morn- 
ing by  Mr.  Douglas,  and  which  are  on  the  statute  books  of  my  own 
state,  mining  men  know  that  it  is  an  every-day  occurrence  to  have  men 
come  to  you,  demanding  that  you  shall  recompense  them  for  injuries, 
many  of  which  are  imaginary  and  many  for  which  the  company  is  in  no 
way  liable.  I  have  such  to  contend  with  daily  and  often  we  are  com- 
pelled to  go  into  court  to  defend  ourselves  against  people  who  are  suing 
us  ofttimes  when  they  have  no  just  claims  against  us.  And  you  will 
always  find,  where  these  laws  exist,  there  is  a  certain  class  of  lawyers 
who  make  it  their  business  to  be  near  when  an  accident  occurs  and 
who  ofttimes  induce  those  injurpd  to  sue  for  recovery  of  damages  on  a 
percentage  basis;  and,  if  you  have  not  this  type  of  lawyer  here  now, 
you  will  have  them,  since  you  have  passed  the  laws  referred  to.  You 
will  also  find  that  when  some  men  receive  slight  injuries — injuries  for 
which  they  don't  lose  more  than  one  or  two  weeks'  time — you  will  be 
sued  for  amounts  of  from  $2,000  to  $10,000.  Although  they  do  not  always 
recover  damages,  they  nevertheless  cause  you  a  great  deal  of  trouble, 
and  I  am  sure,  in  the  main,  that  if  we  had  a  compensation  law  that  would 
be  administered  by  a  commission  of  fair  and  just  men  we  would  be 
much  better  off  than  we  are  at  present,  being  dragged,  as  we  are,  into 
court  on  account  of  every  little  accident  that  occurs  to  our  workmen. 

In  regard  to  compulsory  arbitration,  I  desire  to  say  that  from  my 
own  views  and  dealings  with  labor  I  am  opposed  to  it.  in  Oklahoma, 
the  coal  operators  have  a  joint  agreement  with  their  workmen.  For 
the  past  four  years  we  have  had  a  system  of  compulsory  arbitration  for 
adjusting  our  disputes,  but  at  the  time  of  making  a  new  contract  last 
summer  in  Kansas  City  the  miners  took  a  positive  stand  against  our 
system  of  compulsory  arbitration  and  positively  refused  to  again  sign 
a  contract  in  which  all  cases  not  decided  otherwise  were  finally  to  be 


SS  OFFICIAL     PROCEEDINGS 

arbitrated.  The  operators  favored  compulsory  arbitration  on  the  ground 
that  it  was  better  to  have  a  final  means  of  settlement  of  disputes  (al- 
though the  system  did  not  meet  with  their  entire  approval),  rather  than 
have  tneir  men,  in  case  of  failure  of  settlement  of  any  question,  take 
independent  action  and  strike.  The  president  of  the  Mine  Workers' 
Union  took  a  very  decided  stand  in  opposition  to  compulsory  arbitration 
and  quoted  a  prominent  American  statesman  in  saying  the  world  was 
not  ready  for  compulsory  arbitration.  The  obvious  reasons  of  the  miners 
in  their  opposition  were: 

First — That  believing  their  position  taken  on  a  disputed  subject  was 
right,  they  did  not  propose  to  have  it  subjected  to  the  element  of  chance 
that  always  enters  into  arbitration,  with  the  possibility  of  losing  their 
case; 

Second — The  fact  that  a  case  not  settled  otherwise  has  a  tendency 
to  cause  those  interested,  and  especially  those  who  have  doubts  as  to 
the  justice  of  their  claims,  to  throw  the  responsibility  on  an  arbitrator. 

Their  reasons  are,  in  my  opinion,  good  and  logical.  I  have  found 
that  when  every  argument  is  beaten  down  and  a  position  can  no  longer 
be  maintained,  the  loser  in  the  dispute  is  always  ready  to  declare  in 
favor  of  arbitration.  This  is  the  case  with  both  employer  and  employe. 
I  am  in  favor  of  a  workmen's  compensation  law,  but  opposed  to  com- 
pulsory arbitration. 

CHAIRMAN  DAY:     Who  will  speak  for  California? 

MR.  MUDD:  Mr.  Chairman,  the  last  speaker  referred  to  one  of 
the  workmen's  compensation  laws.  We  have  a  new  compensation  law 
in  California;  the  terms  of  it  are  drastic,  perhaps  as  much  so  as  those 
of  any  state  that  has  enacted  a  compensation  law.  The  premium  rate 
agreed  upon  by  representatives  of  a  number  of  accident  insurance  com- 
panies was  7.86%  of  the  pay  roll  for  underground  employes.  The  Cali- 
fornia Industrial  Accident  Commission  named  the  same  rate,  but  de- 
clined to  accept  any  mining  risks.  I  think  a  number  of  the  stronger 
mining  companies  carry  their  own  compensation  risks,  but  quite  an 
amount  of  insurance  was  written  at  a  premium  rate  of  7.86%  of  the 
pay  roll,  although  some  of  the  accident  companies  made  concessions 
under  certain  conditions. 

The  rates  charged  by  the  California  Industrial  Commission  for  em- 
ployes of  other  industries  were  so  high  that  the  state  is  now  returning 
to  the  insured  about  15%  of  the  premium  paid.  Both  the  state  and  the 
accident  insurance  companies  were  very  uncertain  what  the  proper 
premium  should  be  under  the  new  law,  and  in  the  beginning  made  the 
rate  too  high.  It  is  assured  that  in  the  near  future  both  the  state  and 
the  accident  insurance  companies  will  name  lower  premium  rates. 

The  California  Metal  Producers'  Association  is  now  being  organized 
by  the  actual  operators  of  the  state  and  the  first  subject  they  have  taken 
up  seriously  has  been  this  one  of  compensation  insurance.  Their  in- 
vestigation indicated  that  little  if  any  more  than  one-third  of  the  pre- 
miums charged  ordinarily  for  accident  insurance  reached  the  injured 
employes.  This  does  not  mean  that  the  other  two-thirds  became  a 
profit  to  the  accident  insurance  companies,  for  the  cost  of  securing  new 
'business  and  handling  it  afterwards  is  great,  but  it  does  mean  that  the 
insured  have  to  pay  a  very  high  rate  for  accident  insurance  ordinarily. 

It  was  at  first  thought  it  would  be  necessary  for  the  members  of  the 
California  Metal  Producers'  Association  to  adopt  a  co-operative  or  inter- 
insurance  plan.  After  this  plan  was  advanced  one  of  the  accident  insur- 
ance companies  named  a  sufficiently  low  rate  to  be  attractive  and  insur- 
ance will  be  taken  out  by  many  of  the  members  of  the  California  Metal 
Producers'  Association  with  this  particular  accident  insurance  company. 
The  rate  charged  is  very  much  less  than  the  rates  asked  a  year  ago. 


AMERICAN     MINING     CONGRESS  89 

A  gentleman  from  Arizona  referred  to  the  conditions  in  Germany, 
where  compensation  insurance  has  been  in  force  for  many  years,  and 
said  that  the  number  of  accidents  was  great  and  that  the  injuries  were 
glow  in  healing. 

Twenty-five  years  or  more  ago  I  was  connected  with  a  property  that 
was  doing  very  well  indeed.  The  stockholders  were  happy  and  generous 
and  they  wanted  to  do  everything  they  could  for  the  miners.  They 
adopted  a  rule  that  whenever  a  man  was  sick  or  injured  he  should  re- 
ceive full  pay  until  he  returned  to  work.  Accidents  were  numerous  and 
it  seemed  that  the  men  were  very  slow  in  recovering.  Sprained  backs 
and  mashed  fingers  were  out  of  all  proportion  just  before  a  baseball 
game  or  any  other  attractive  event.  The  amount  of  money  paid  to  em- 
ployes for  time  when  they  were  not  at  work  became  so  great  that  finally 
the  rule  referred  to  was  abandoned  altogether  and  the  men  were  forced 
to  make  a  very  clear  case  before  any  compensation  for  injuries  was 
allowed.  Thereafter  the  number  of  injuries  was  reduced  materially. 

I  believe  no  compensation  laws  will  in  the  end  be  satisfactory  to 
both  parties  until  the  employe  becomes  a  contributor  to  the  compensation 
fund. 

No  matter  how  well  a  law  may  be  framed  there  will  be  more  or 
less  injustice  to  both  employer  and  employe.  I  think  the  question  of 
unjust  claims  has  been  the  one  that  has  worried  the  accident  insurance 
companies  in  California  more  than  any  other.  The  proper  premium 
under  a  specific  state  law  can  only  be  determined  accurately  by  the 
experience  of  a  number  of  years.  This  proper  premium  will  be  effected 
by  the  precautions  taken  and  rules  adopted  by  the  employers,  but,  more 
largely,  by  the  earnest  efforts  of  the  employes  to  prevent  accidents  to 
themselves  and  to  co-employes  and  the  monetary  interest  in  seeing  that 
no  unjust  claims  shall  be  made  by  any  of  the  employes.  The  aid  of  the 
employes  in  eliminating  unfair  compensation  will  become  a  very  im- 
portant matter  and  I  fear  such  aid  will  not  be  freely  and  systematically 
given  until  the  employes  themselves  are  financially  interested  in  reduc- 
ing the  premium  rate  through  the  fact  that  they  themselves  are  con- 
tributors of  a  certain  percentage  of  the  premium. 

While  the  employer  will  probably  always  contribute  the  greater 
portion  of  the  money  for  compensation  insurance,  I  believe  the  contri- 
bution of  the  employes  will  aventually  be  welcomed  by  the  employes 
and  will  result  in  a  more  self-respecting,  independent  set  of  workmen. 
All  of  us  have  probably  noted  the  reluctance  of  employes  to  use  facilities 
around  mines  and  smelters  which  are  furnished  free  and  to  which  they 
contribute  little  in  the  way  of  money  or  control. 

I  believe  ultimately  we  must  come  to  an  arrangement  whereby  part 
at  least  of  the  compensation  comes  out  of  the  fund  deducted  from  the 
employes'  wages  before  the  compensation  laws  reach  their  final  and 
?iaost  satisfactory  form.  (Applause.) 

CHAIRMAN  DAY:  We  are  getting  a  large  amount  of  valuable  in- 
tormation  as  we  go  along,  gentlemen,  and  we  would  like  to  hear  from 
others. 

Before  Colorado  volunteers — and  I  know  there  will  be  a  dozen  of 
them — I  would  like  to  ask  Mr.  Carl  Scholz,  the  President,  to  come  for- 
ward and  take  his  job.  I  belong  to  the  Resolutions  Committee,  and  I 
see  a  chance  to  get  away  now  that  that  committee  is  going  out  to  resume 
its  labors. 

THE  PRESIDENT:  I  will  call  on  the  Secretary  to  speak  for  Colo- 
rado. 

THE  SECRETARY:  Mr.  President,  I  would  like  to  refer  to  one 
recent  instance  in  Colorado  as  an  example  of  one  of  the  things  that 
stand  in  the  way  of  a  better  mining  development  and  which  I  fear  in  the 


90  OFFICIAL     PROCEEDINGS 

future  is  going  to  be  a  greater  obstacle  than  it  has  been  in  the  past. 
I  will  first  state  the  facts  as  nearly  as  I  have  them.  Some  years  ago 
Mr.  Bolthoff,  whom  you  will  recognize  as  the  junior  member  of  the  firm 
of  Hendrie  £  Bolthoff,  the  machinery  manufacturing  firm  in  Denver, 
filed  on  a  number  of  mining  claims  and  a  mill  site  in  the  Clear  Creek 
valley.  As  time  went  on  he  proceeded  to  develop  those  claims,  spending, 
I  am  told,  something  like  $60,000.  Something  like  a  year  ago  he  con- 
cluded that  the  development  had  proceeded  far  enough  to  justify  the 
construction  of  a  mill.  He  proceeded  to  the  construction  of  a  mill  upon 
the  mill  site,  and  at  the  same  time  applied  to  the  government  for  patents 
upon  his  mill  site  and  upon  his  mining  claims.  While  his  patent  appli- 
cation was  pending  he  expended  something  like  $25,000  in  permanent 
construction  work  upon  a  mill  and  had  machinery  of  approximately  equal 
value  purchased  for  it,  ready  to  complete  the  mill,  when,  to  his  great 
surprise,  he  was  met  by  the  determination  of  the  Land  Department  that 
the  mill  site  connected  with  his  mining  claims  could  not  go  to  patent 
because  of  the  fact  that  the  valley  had  been  withdrawn  from  entry  as  a 
water  power  site  and  in  consequence  his  mill  site  could  not  be  patented. 
An  appeal  has  been  made  to  the  Secretary  of  the  Interior.  Mr.  Bolthoff 
was  forced  to  employ  a  firm  of  attorneys,  sending  them  to  Washington, 
and  after  considerable  effort  on  the  part  of  the  senators  from  Colorado 
a  hearing  was  finally  arranged  before  a  subordinate  of  the  Interior  De- 
partment, The  attorney  presented  his  case  very  ably  and  is  now  await- 
ing a  decision.  I  am  not  certain,  of  course,  as  to  what  the  decision  will 
be.  One  thing  is  certain,  however,  the  only  ground  upon  which  he  can 
hope  for  the  cancellation  of  the  withdrawal  and  the  granting  of  his 
patent  is  the  fact  that  his  mill  site  was  filed  on  before  the  withdrawal 
was  made.  Had  it  been  after  the  withdrawal  there  would  be  no  hope 
for  his  getting  patent  to  that  ground  until  the  federal  administration 
shall  entirely  reverse  its  theory  of  handling  of  our  Western  lands.  There 
is  a  possibility  that  he  may  receive  his  patent.  But,  gentlemen,  had  he 
known  that  he  was  going  to  get  into  this  trouble  do  you  suppose  he 
would  have  spent  $60,000  in  the  development  of  those  claims?  Would 
he  have  undertaken  to  build  a  mill  for  the  treatment  of  ore  which  he  had 
developed?  There  is  but  one  answer  to  that  question,  and  the  fear  that 
we  may  get  into  some  triuble  of  that  sort  is,  to  my  mind,  preventing 
the  development  of  many  mining  claims  in  the  West. 

Had  Mr.  Bolthoff  found  it  necessary  to  raise  money  for  this  enter- 
prise by  the  sale  of  stock  he  could  not  have  raised  the  money,  but  if 
he  had  and  the  investors  had  lost  their  money  the  gentlemen  who  sup- 
port and  approve  this  federal  interference  would  have  raised  their  hands 
in  holy  horror  at  the  iniquity  of  the  dishonest  promoter. 

The  present  session  of  Congress  is  considering  a  bill  for  the  leasing 
of  mineral  lands  of  the  West.  The  Mining  Congress  has  been  on  record 
in  opposition  to  a  federal  leasing  system  within  the  states.  It  has  done 
everything  it  could  to  prevent  but  it  has  not  been  strong  enough  to 
prevent  the  progress  of  these  bills.  The  Alaska  leasing  bill  has  been 
passed,  the  leasing  bill  for  the  states  is  on  the  calendar  and  has  been 
passed  by  one  body  and  is  now  before  the  other,  and  there  is  but  one 
hope  that  it  may  be  defeated,  and  that  is  that  through  dilatory  tactics 
Western  senators  may  be  able  to  prevent  its  final  adoption.  That  is 
one  of  the  things  which,  it  seems  to  me,  stands  in  the  way  of  mining 
development.  In  line  with  what  our  good  friend  from  Utah  has  said, 
the  effort  to  administer  public  lands  at  this  great  distance  by  a  machine 
which  requires  years  to  get  into  action,  in  my  judgment  will  be  found 
entirely  inadequate.  Mining  men  of  the  West  take  quick  action  when 
they  go  into  business  operations,  and  when  they  have  to  do  business 
with  a  machine  which  cannot  by  its  very  nature,  be  moved  inside  of 
two  or  three  years,  it  will  necessarily  delay  mining  operations  in  the 
West.  Another  proposition,  which  seems  to  me  to  be  iniquitous,  and  on 


AMERICAN     MINING     CONGRESS  91 

which  we  ought  to  take  strong  ground,  is  the  method  required  in  securing 
a  right  of  way  over  the  public  domain  for  a  public  utility.  If  a  public 
utility  needs  a  right  of  way  over  privately  owned  land,  and  the  owner 
refuses  to  sell  at  a  fair  price,  the  utility  company  proceeds  under  the 
eminent  domain  acts  to  take  possession  of  the  land  and  in  condemnation 
proceedings  forces  the  private  owner  to  surrender  the  right  of  way  for 
what  the  court  shall  determine  to  be  a  fair  price.  You  are  absolutely 
prevented  from  bringing  a  similar  suit  against  the  federal  government, 
because  you  cannot  sue  the  government.  Unless  the  government  allows 
you  by  permission  to  have  a  right  of  way  for  a  public  utility  you  cannot 
get  it.  This  condition  was  long  since  recognized  by  Congress,  as  it  was 
provided  in  the  original  law  years  ago  that  "a  right  of  way  is  hereby 
granted  across  the  public  domain" — and  described  the  utilities  which 
could  take  advantage  of  that  law.  In  other  words,  the  government  didn't 
stand  back  at  that  time,  under  the  old  theory  of  the  administration  of 
the  public  lands,  and  say  you  must  even  condemn.  All  you  needed  to 
do  was  to  satisfy  the  Secretary  of  the  Interior  that  a  public  purpose  is 
to  be  served  and  your  right  of  way  was  granted  without  litigation.  This 
supervisory  power  was  given  the  Secretary  of  the  Interior  simply  that 
he  might  see  to  it  that  your  right  of  way  and  mine  did  not  conflict;  in 
other  words,  require  you  to  file  your  plat  in  such  a  way  that  if  after- 
wards I  sought  a  right  of  way  I  would  not  conflict  with  yours,  or  in  case 
the  government  should  sell  that  land  to  some  one  else  for  other  pur- 
poses it  would  be  sold  with  the  reservation  of  your  right  of  way,  and 
your  description  was  required  to  be  so  definite  that  the  reservation  could 
be  properly  made.  But  in  these  days  a  different  construction  has  been 
given,  a,nd  now  if  a  right  of  way  across  the  public  land  is  required  for  a 
utility  it  is  not  a  matter  of  right.  It  seems  to  me  that  we  should  stand 
for  the  right  of  condemnation  for  a  right  of  way  across  the  public  domain, 
and  that  the  public  domain  ought  not  to  be  more  sacred  than  the  private 
holding  of  an  individual.  In  my  judgment  this  is  one  of  the  things  which 
in  future  years  is  going  to  interfere  very  seriously  with  the  progress  and 
development  of  mining  operations.  I  thank  you,  gentlemen. 

MR.  BASS:  Mr.  President,  on  those  lines  I  would  like  to  say  a  few 
words  because  it  hits  my  case  thoroughly.  I  at  one  time  located  a  mill 
site  down  in  Grand  Canyon  for  the  working  of  asbestos  mines.  I  located 
it  before  it  had  been  declared  a  national  reserve.  But  shortly  after  that 
the  superintendent  of  forestry  on  the  north  side  notified  me  to  meet 
him  there.  Of  course  I  neglected  my  business  and  went  down  there  to 
see  him,  but  he  didn't  show  up.  But  some  days  afterwards  he  did,  and 
when  I  went  down  there  afterwards  I  found  that  he  had  put  up  a  notice 
prohibiting  me  from  going  on  this  particular  mill  site,  because  it  was  on 
a  forest  reserve,  mind  you,  a  forest  reserve  down  in  Grand  Canyon 
where  there  is  not  enough  timber  for  firewood — and  also  a  national  game 
park.  I  paid  no  attention  to  it  at  all.  I  wrote  back  and  told  him  that 
my  filings  were  all  recorded  and  I  considered  I  had  a  right  there.  He  put 
me  to  a  great  deal  of  trouble  and  expense.  The  gentleman  from  Utah 
has  hit  the  nail  on  the  head  and  on  the  top  of  it  and  all  over  it,  for  the 
simple  reason  that  when  you  come  to  leasing  water  power,  the  govern- 
ment plan  of  leasing  it,  means  not  conservation  but  confiscation.  That  is 
what  it  means.  Now,  we  have  heard  a  great  deal  about  damming  the 
Colorado.  When  you  come  to  build  a  reservoir  to  irrigate  all  of  Arizona, 
well,  I  do  not  believe  you  could  place  the  stock  of  a  company  of  that 
kind  today  among  multi-millionaires,  provided  they  knew  anything  about 
it.  I  know  something  about  it.  I  know  that  when  that  river  gets  right 
mad  and  runs  twenty  miles  an  hour  and  brings  down  thousands  of  tons 
of  all  kinds  of  stuff,  it  would  fill  up  any  dam  and  preclude  the  mainte- 
nance of  any  power  plant.  But  I  do  know  that  after  a  while  if  people 
understand  the  situation  there  you  can  cut  a  tunnel  there  that  will  con- 
fine that  river  at  the  west  end  of  the  Granite  Gorge  and  make  a  water 


»2  OFFICIAL     PROCEEDINGS 

power  that  I  believe  would  turn  half  the  world  over,  because  you  cam 
get  120  feet  fall  by  building  a  tunnel  something  like  two  miles,  just  cut- 
ting a  tunnel  through.  Some  years  ago  I  took  Mr.  A.  J.  Chandler  down 
there  to  investigate  the  water  power.  Now,  this  gentleman  from  Utah 
will  bear  me  out  in  the  statement  that  there  is  an  immense  body  of 
timber  over  the  Utah  side  of  the  Grand  Canyon.  That  is  the  part  of 
Arizona  of  which  the  gentleman  spoke  when  he  said  if  we  were  like 
those  people  who  were  in  the  habit  of  giving  away  their  horses  and 
watches  and  everything  else  we  would  give  them.  Well,  of  course,  I  am 
always  fighting  that,  because  I  happen  to  know  about  it,  and  I  think  that 
unless  Utah  would  be  willing  to  give  us  their  part  on  the  other  side  of 
the  river  we  will  not  give  them  what  is  on  our  side.  I  oppose  it  because 
there  is  a  whole  lot  of  good  stuff  on  the  east  side  of  the  river,  as  this 
gentleman  will  admit.  There  are  two  billion  feet  of  merchantable  tim- 
ber on  that  side  of  the  Grand  Canyon  that  can  be  put  on  the  market. 
Now,  how  long  does  it  take  to  cut  a  billion  feet  of  lumber?  It  would 
take  quite  a  good  while,  wouldn't  it?  And  yet  I  made  that  statement  once 
before,  and  I  believe  somebody  said  there  was  nothing  like  that.  I  be- 
lieve it  was  our  senator  from  Flagstaff  who  made  some  such  statement 
as  that.  You  can  develop  all  the  horsepower  you  want  from  the  water 
from  those  creeks  up  there;  you  can  turn  it  over  and  over  and  over  and 
use  it  as  many  times  as  you  like.  To  tie  up  that  land  in  the  hands  of 
the  government  as  it  has  been  tied  up,  looks  too  ridiculous,  and  when 
you  go  to  get  your  permits  they  put  a  man  over  you  to  tell  you  what 
you  must  do,  and  that  man  doesn't  know  anything  about  the  conditions. 

Now,  as  to  the  tying  up  or  the  leasing  of  the  public  domain  over 
there  anywhere  along  the  Grand  Canyon  in  the  granite  section,  I  don't 
care  where  you  go  in  the  mineral  region  you  will  find  the  secondary  forms 
of  mineral.  To  tie  it  up,  to  lease  it,  would  stop  the  development  of  it. 
There  are  thousands  of  acres  of  good  land  up  there,  too.  I  think  ther** 
is  a  man  here  from  Arizona,  from  the  northern  part,  who  knows  that 
only  a  few  years  ago  it  was  pretty  hard  to  get  a  sack  of  potatoes  up 
there,  and  I  understand  they  have  shipped  down  here  to  you  people  thia 
season  about  23  carloads.  I  am  opposed  to  the  leasing  of  the  public 
domain  because  I  am  interested  in  the  betterment  of  the  small  farmer. 
(Applause.) 

MR.  SIZER:  Mr.  President,  I  rise  to  ask  whether  the  gentlemam 
from  Texas,  who  spoke  this  morning,  has  succeeded  in  finding  his  paper. 
If  he  has,  I  for  one  would  very  much  like  to  hear  it. 

THE  PRESIDENT:  Dr.  Phillips,  give  an  account  of  yourself.  One 
of  us  is  going  to  be  made  out  a  liar,  you  or  myself. 

DR.  PHILLIPS:  I  have  been  a  more  or  less  successful  liar  all  my 
life.  But  three  weeks  ago  I  had  a  receipt  from  your  Secretary,  Mr.  Prea 
ident,  for  the  paper  that  I  sent  him  on  that  subject. 

THE  PRESIDENT:  You  refer  to  the  assistant  secretary,  I  presume 
— who  is  not  here? 

MR.  PHILLIPS:  I  think  it  was  Mr.  Wolcott  who  sent  it  to  me;  S 
don't  think  it  was  Mr.  Callbreath. 

SECRETARY  CALLBREATH:     Is  Mr.  Wolcott  in  the  room? 

DR.  PHILLIPS:  No;  I  wouldn't  make  the  assertion  if  I  thought 
he  was  here. 

THE  PRESIDENT:  I  knew  it.  This  paper  is  going  to  be  published 
in  the  proceedings,  and  the  proceedings  will  be  published  very  promptly, 
and  we  will  ask  your  indulgence  to  wait  until  you  see  it  there.  Is  there 
anything  else  to  come  before  the  session  this  afternoon?  If  not,  I  will 
declare  the  Congress  adjourned  until  9:30  tomorrow  morning. 

Meeting  adjourned. 


AMERICAN     MINING     CONGRESS  »8 

THURSDAY,   DECEMBER    10,   1914. 

Morning  Session. 
9:30   O'clock  A.  M. 
(President  Scholz  in  the  chair.) 

THE  PRESIDENT:  The  meeting  will  please  come  to  order.  Gen- 
tlemen, there  are  several  committees  to  report.  There  was  a  committee 
appointed  to  audit  the  accounts.  Is  that  committee  ready  to  report? 

SECRETARY  CALLBREATH:  I  have  the  report  here,  Mr.  Preg- 
ident. 

(Auditing  Committee's  report  read  by  President.) 

Report   of   Auditing    Committee. 

Phoenix,  Arizona,  December  10,  1914. 

We,  the  undersigned  committee,  appointed  to  audit  the  books  of  the 
Secretary  of  the  American  Mining  Congress,  have  gone  over  the  accounts 
mud  find  the  same  to  be  correct. 

(Signed)     F.  K.  BRUNTON, 
GEO.    H.    UTTER, 
Auditing  Committee. 

A  DELEGATE:     Mr.  President,  I  move  that  the  report  be  approved. 
(Motion  seconded  and  carried  unanimously.) 

THE  PRESIDENT:  The  next  item  on  the  program  is  a  report  front 
the  Committee  on  Resolutions.  Are  there  any  other  reports  to  be  pre- 
sented this  morning,  Mr.  Secretary? 

SECRETARY  CALLBREATH:  No,  there  are  no  others,  I  think, 
except  that  of  the  Resolutions  Committee. 

MR.  CARMICHAEL:  Mr.  President,  your  Committee  on  Resolutions 
having  had  under  consideration  Resolution  No.  2,  introduced  by  the  Com- 
mittee on  Revision  of  Mineral  Land  Laws,  do  hereby  recommend  that  the 
tame  be  amended  by  substituting  therefor  the  following: 

Resolution  No.  2,  as  Amended. 

"Be  It  Resolved,  By  the  American  Mining  Congress  at  its  Seventeentk 
Annual  Convention  assembled  at  Phoenix,  Arizona,  that  Congress  be 
urged  to  pass  legislation  now  before  it  providing  for  the  revision  of  the 
mineral  land  laws  of  the  United  States." 

THE  PRESIDENT:  That  is  a  substitute  for  the  original  as  sub- 
mitted? 

MR.  CARMICHAEL:  Yes,  and  I  move  that  the  resolution  as 
amended  by  the  committee  be  adopted. 

MR.  CLARK:     I  accept  the  amendment. 

SECRETARY  CALLBREATH:  Mr.  President,  in  view  of  the  fact 
that  the  maker  of  the  resolution  accepts  the  amendment,  it  may  be  wise 
to  assume  that  this  amendment  was  introduced  in  this  shape  instead  of 
as  it  originally  stood. 

MR.  CLARK:  The  provision  was  recommended  by  the  committee, 
and  just  merely  to  expedite  the  business  was  the  reason  I  accepted  it. 
I  do  not  think  the  amendment  really  covers  the  ground  we  want  to  cover, 
but  I  thought  I  could  get  at  that  in  some  other  way.  But  the  point  is, 
we  have  recommended  there  a  certain  kind  of  a  committee,  and  we  want 
an  appropriation. 

(Motion  seconded  and  carried  unanimously.) 


94  OFFICIAL     PROCEEDINGS 

MR.  CARMICHAEL:  Your  Committee  on  Resolutions  has  had  under 
consideration  Resolution  No.  4,  and  recommend  that  same  be  amended 
to  read  as  follows: 

Resolution  No.  4,  Introduced  by  C.  H.  Clapp,  C.  T.  Willis  and  S.  H.  Wor- 
rell, as  Amended. 

Whereas,  The  Congress  of  the  United  States  of  America  has  appro- 
priated at  various  times  the  Merrill  Fund  of  $50,000,  the  Adams  Fund 
of  $20,000,  the  Hatch  Fund  of  $15,000  and  the  Lever  Fund  of  $10,000 
yearly  to  each  state  agricultural  college,  making  a  total  of  $95,000 
yearly;  and 

Whereas,  The  expenditures  of  the  above  sums  of  money  have  been 
productive  of  great  advantage  to  the  agricultural  interests  of  the  coun- 
try ;  and 

Whereas,  No  money  has  been  appropriated  at  any  time  to  foster  and 
stimulate  instruction  in  mining  schools  although  approximately  50%  of 
the  above  amounts  are  directly  for  instruction  in  agricultural  subjects; 
and 

Whereas,  The  total  aggregate  value  of  agricultural  products  is  $10,- 
000,000,000,  and  the  total  value  of  mineral  products  is  $4,600,000,000,  or 
46%;  and 

Whereas,  The  importance  of  the  industry  is  further  reflected  by  the 
fact  that  approximately  60%  of  the  freight  hauled  by  the  railroads  is 
for  the  mining  industry; 

Therefore,  Be  It  Resolved,  That  we,  as  representatives  of  the  min- 
ing industry,  ask  the  Congress  of  the  United  States  to  pass  favorably  a 
bill  similar  to  the  Austin  bill,  which  provides  that  an  appropriation  of 
$25,000  per*  annum  be  made  to  each  mining  school  in  the  United  States. 

MR.  CARMICHAEL:     We  recommend  that  the  resolution  be  passed, 
and  move  its  adoption. 
(Motion  seconded.) 

SECRETARY  CALLBREATH:  May  I  say  only  one  word  on  the 
resolution,  Mr.  President?  Only  to  question  the  figures  as  to  agricultural 
production.  I  have  hoped  for  the  opportunity  to  analyze  the  agricultural 
production  statistics  in  such  a  way  as  to  show  the  real  truth.  In  the 
agricultural  reports  showing  this  enormous  production  we  will  find  that 
hay  is  counted,  and  later  on  that  hay  is  fed  to  cattle  and  the  beef  is 
counted  and  later  the  hides  are  counted.  In  many  other  lines  you  will 
find  the  report  of  the  agricultural  production  of  the  country  is  enhanced 
by  a  duplication  of  the  product,  while  in  mining  we  are  held  right  down 
to  the  actual  production  of  the  mine.  When  an  actual  comparison  be- 
tween the  total  products  in  the  two  industries  is  made  the  mining  in- 
dustry will  come  very  much  nearer  equaling  in  production  that  which  is 
reported  for  agriculture. 

THE  PRESIDENT:  I  live  in  Illinois,  and  I  was  much  surprised  in 
reading  the  reports  of  the  Geological  Survey  of  the  enormous  iron  pro- 
duction of  the  state,  and  I  began  to  look  for  an  iron  mine.  I  found  that 
the  iron  referred  to  was  that  which  came  to  Chicago  by  boat  from 
Northern  Michigan.  So  I  guess  the  same  condition  applies  to  both  in- 
dustries. But  I  think  it  would  be  well  to  make  an  investigation  anyway. 

(Motion  carried  unanimously.) 

MR.  CARMICHAEL:  Mr.  President,  your  Committee  on  Resolutions 
having  had  under  consideration  Resolution  No.  5,  introduced  by  Mr. 
William  B.  Phillips  and  Mr.  R.  C.  Allen,  do  hereby  recommend  that  same 
be  passed,  and  I  move  the  adoption  of  the  resolution. 


AMERICAN     MINING     CONGRESS  95 

SECRETARY  CALLBREATH:  This  is  a  very  important  resolution, 
and  in  the  appointment  of  a  committee  of  three  in  each  state  the  President 
will  find  a  very  difficult  proposition  unless  the  people  from  the  several 
states  who  are  interested  in  this  matter  shall  volunteer  to  do  their  part 
of  the  work. 

(Motion  seconded  and  carried  unanimously.) 

MR.  CARMICHAEL:  Mr.  President,  your  Committee  on  Resolutions 
having  had  under  consideration  Resolution  No.  7,  do  hereby  recommend 
that  the  same  be  amended  as  follows,  and  I  move  the  adoption  of  the 
resolution: 

Resolution   No.  7,  as  Amended,  Introduced   by  W.  G.  Swart  of  Colorado. 

That  the  American  Mining  Congress,  recognizing  the  necessity  of 
carrying  forward  the  movement  for  greater  safety  in  mining,  places 
itself  hereby  on  record  as  in  favor  of  the  earliest  possible  adoption  of  a 
uniform  national  system  of  bell  and  danger  signals,  and  urges  the  Bureau 
of  Mines  to  take  such  action  as  will  insure  the  accomplishment  of  this 
object. 

(Motion  seconded  and  carried  unanimously.) 

MR.  CARMICHAEL:  Your  Committee  on  Resolutions  recommend 
the  adoption  of  Resolution  No.  6,  introduced  by  Mr.  W.  G.  Swart  of 
Colorado,  and  I  move  its  adoption. 

(Motion  seconded  and  carried  unanimously.) 

MR.  CARMICHAEL:  That  is  all  just  now,  Mr.  President.  We  will 
have  a  few  more  resolutions  later  on. 

THE  PRESIDENT:  While  the  Resolutions  Committee  are  com- 
pleting their  work  I  am  going  to  take  the  liberty  of  asking  Dr.  Holmes 
to  come  on  the  stage — not  under  the  five-minute  rule  but  under  the 
three-minute  rule.  Not  that  we  do  not  want  him  all  day,  but  I  would 
like  to  have  the  Doctor  come  forward  and  address  the  audience  for  just 
a  few  minutes,  and  I  will  appoint  a  committee  to  escort  him  to  the 
platform.  I  will  ask  Mr.  Dern  and  Mr.  Brunton  to  serve  upon  that 
committee. 

(Dr.  Holmes  was  enthusiastically  applauded  as  he  ascended  the 
platform.) 

DR.  HOLMES:  Mr.  President  and  Fellow  Members  of  the  American 
Mining  Congress:  It  is  certainly  one  of  the  pleasures  of  the  year  to 
meet  with  the  mining  men  on  occasions  of  this  kind.  The  Bureau  of 
Mines  and  its  work  is  something  quite  young,  having  been  established 
only  in  1910,  and  therefore  you  might  say  that  during  the  few  years 
since  that  time  it  has  been  little  more  than  well  inaugurated.  But  there 
are  always  two  conditions  necessary  in  the  accomplishment  of  a  work 
of  its  kind.  The  first  condition  is  to  have  money  enough  for  the  per- 
sonnel, the  proper  men,  experts,  and  for  the  equipment  with  which  to 
do  their  work.  The  Bureau  of  Mines  has  today  not  a  much  larger  ap- 
propriation than  had  the  old  technological  branch  under  the  Geological 
Survey  several  years  ago.  Since  the  Bureau  of  Mines  was  organized  in 
1910  there  has  been  comparatively  little  increase  in  the  moneys  appropri- 
ated for  the  actual  investigations  of  mining,  consequently  we  have  not 
been  able  to  do  the  amount  of  work  which  we  would  like  to  have  done. 
Our  plans  for  the  present  year  are  in  no  way  enlarged  upon  those  of 
the  past  year.  Now,  that  is  a  condition  which  is  going  to  continue  as 
it  is  now  until  the  mining  people  of  this  country  make  up  their  minds 
to  the  fact  that  they  are  not  being  treated  on  the  square.  You  realize 
this  very  interesting  information  brought  out  by  the  President  in  his 
address  the  other  evening,  that  whereas  every  miner  in  this  country 


96  OFFICIAL    PROCEEDINGS 

contributes  something  like  $1,800  a  year  to  the  national  wealth,  as  com- 
pared to  ,$800  or  $900  contributed  by  every  farmer  of  the  country  to 
the  national  wealth,  at  the  same  time  the  people  of  the  United  States 
contribute  28  to  30  cents  per  capita  for  the  advancement  of  agriculture 
and  less  than  2  cents  per  capita  to  the  advancement  of  mining;  that 
in  spite  of  the  fact  that  mining  is  the  most  hazardous  of  our  great 
industries  and  agriculture  is  the  safest;  that  in  mining  we  have  one 
lot  of  mineral  resources  and  that  when  they  are  gone  the  nation  must 
depend  upon  something  else  or  some  other  country,  whereas  agriculture 
is  a  self-perpetuating  industry.  Why  is  it  that  it  is  so  difficult  to  get 
anything  done  out  of  the  federal  or  state  treasury  on  behalf  of  mining? 
And  the  first  reason  which  I  found  in  talking  with  members  of  Congress 
is  the  fact  that  when  you  talk  to  them  about  helping  mining  what  they 
see  is  the  Homestake  and  the  Treadwell  and  the  United  Verde  and  half 
a  dozen  great,  big  mines  in  the  country,  and  they  say,  "Why,  those 
fellows  are  rich  enough  to  take  care  of  themselves."  They  don't  see 
the  small  mines  of  the  country;  they  don't  see  the  struggling  miners 
who  are  trying  to  build  up  a  great  industry,  and  the  reason  they  don't 
see  these  things  is  because  they  are  not  presented  to  them;  and  in  that 
connection  I  want  to  emphasize  one  of  the  most  important  lessons  for 
this  session  of  the  Mining  Congress  to  learn  thoroughly,  and  that  is  that 
until  the  mining  people  of  this  country  do  what  the  railroad  companies 
of  the  country  are  doing,  educating  public  sentiment  as  to  what  this 
great  industry  is  and  what  it  means  to  this  nation,  the  people  of  the 
United  States  will  never  understand  it.  You  know  for  many  years  the 
railroads  followed  the  policy  of  doing  what  they  called  quiet  work.  They 
endeavored  to  control  legislation  by  interviewing  on  the  side  important 
politicians.  Now  they  have  found  that  that  is  a  sort  of  thing  that  the 
American  public  is  rebelling  against.  That  is  the  sort  of  thing  which  at 
the  present  time  won't  go,  and  they  have  found  it  to  be  the  case.  No 
class  of  people  in  this  country  became  so  much  and  so  thoroughly 
suspicioned  as  were  the  railroad  men.  Now,  what  they  have  done  was 
to  decide  on  another  policy.  They  have  come  squarely  out  into  th« 
open.  They  have  organized,  as  was  told  you  here  the  other  evening, 
a  bureau  of  railroad  economics,  a  bureau  of  information  which  they 
support  in  Washington.  That  bureau  has  done  so  much  good  to  the 
railroads  that  it  has  brought  about  recently  a  rehearing  before  the 
Interstate  Commerce  Commission  on  the  rate  question,  and  in  many  ways 
it  is  securing  fair  treatment  for  the  railroads,  and  just  as  soon  as  the 
mining  interests  of  this  country  all  pull  together — and  the  American 
Mining  Congress  is  the  best  organization  through  which  they  can  pull 
together — in  my  judgment  they  will  educate  public  opinion  in  this 
country  so  that  unjust  taxation  and  unfair  legislation  which  will  en- 
danger the  industry  will  become  an  impossibility.  One  of  the  most 
encouraging  evidences  of  this  fact  is  that  within  the  state  of  Missouri, 
within  the  past  few  months,  we  have  seen  the  recall  of  the  obnoxious 
legislation  which  was  popular  in  its  day  with  both  politician  and  voter, 
but  when  attention  was  called  to  the  real  situation,  how  it  was  injuring 
the  public  and  injuring  the  private  property  and  the  great  railway  lines, 
the  people  of  the  state  of  Missouri  recalled  that  legislation,  and  they 
will  be  fair  to  the  mining  industry  and  they  will  support  the  mining 
industry  and  will  treat  it  justly  and  fairly  for  all  time  if  the  mining 
people  of  this  country  will  get  together  and  pull  together,  educate  them 
as  they  ought  to  be  educated  and  give  them  information  in  which  they 
have  real  confidence. 

I  thank  you  very  much  for  this  opportunity  to  speak  to  you,  and 
I  am  very  glad  to  be  here  with  you,  and  have  enjoyed  my  association 
with  you  since  you  have  been  in  Phoenix.  (Great  applause.) 

THE  PRESIDENT:  Gentlemen,  it  is  a  rare  pleasure  indeed  to  have 
Dr.  Holmes  with  us  and  to  hear  his  remarks.  He  has  done  a  great  deal 


AMERICAN     MINING     CONGRESS  97 

for  our  business,  as  we  all  know,  and  we  owe  him  a  great  deal;  more,  I 
think,  than  we  will  ever  be  able  to  tell  him. 

SECRETARY  CALLBREATH:  Mr.  President,  I  desire  to  announce 
the  election  of  officers  by  the  Board  of  Directors  at  their  meeting  last 
night,  as  follows: 

For  President,  Carl  Scholz. 

For  First  Vice  President,  Harry  L.  Day. 

For  Second  Vice  President,  M.  S.  Kemmerer. 

For  Third  Vice  President,  George  H.  Dem. 

For  Secretary,  J.  F.  Callbreath. 

The  Executive  Committee  elected  is  Messrs.  Carl  Scholz,  Charles  S. 
Keith  and  Walter  Douglas. 

In  additon  to  that,  the  Board  of  Directors  exercised  the  privilege 
given  under  the  by-laws  to  create  an  honorary  life  membership.  The 
directors  are  limited  by  the  by-laws  to  one  each  year,  and  I  might  say 
this  is  the  fourth  time  this  privilege  has  been  exercised  in  the  seventeen 
years  of  the  life  of  the  Mining  Congress.  The  Board  of  Directors  yester- 
day conferred  that  honor  upon  Dr.  James  Douglas  of  New  York. 

PRESIDENT  SCHOLZ:  Gentlemen,  I  would  be  very  remiss  if  I 
did  not  express  my  gratification  over  my  re-election  as  President  of  the 
Congress.  Frankly,  when  I  entered  the  committee  room  last  night  I 
had  hoped  that  the  directors  would  say,  "Well  done,  thou  good  and 
faithful  servant,"  but,  on  the  other  hand,  they  said,  ''If  at  first  you  don't 
succeed,  try,  try  again.  Don't  be  discouraged,"  and  they  have  handed 
you  another  lemon.  I  saw  one  down  the  street  last  night  that  weighed 
2%  pounds,  I  tip  the  scales  at  157.  You  can  figure  out  the  ratio.  A 
year  ago  I  was  elected  president  because  I  had  "put  it  over"  on  the  coal 
men.  I  then  had  in  mind  the  adage  which  emanated  from  our  great 
statesman,  Mr.  Lincoln,  who  wisely  said,  "You  can  fool  some  of  the 
people  part  of  the  time,  part  of  the  people  all  of  the  time,  but  you  can't 
fool  all  of  the  people  all  of  the  time."  I  think  I  have  beat  him  to  it. 
(Laughter.) 

Since  this  is  the  last  session  of  the  Congress  I  feel  that  I  should 
voice  the  sentiments  of  the  delegates  and  the  visitors  who  have  been 
here  by  thanking  the  Committee  on  Arrangements  and  the  citizens  of 
Arizona,  and,  more  particularly,  of  Phoenix,  for  the  very  cordial  welcome 
they  have  given  us  and  the  very  courteous  and  delicate  way  in  which 
they  have  carried  it  out.  I  travel  more  or  less  and  have  been  in  any 
number  of  civilized  and  a  great  many  uncivilized  sections,  but  never 
have  I  found  a  place  which  I  liked  so  well  as  I  like  Phoenix.  I  was  im- 
pressed when  I  came  with  the  magnitude  of  the  desert,  with  the  miracles 
wrought  by  the  waters,  with  the  wonderful  buildings  and  streets;  but 
most  of  all  I  have  been  impressed  with  the  people,  and  those  of  us  who 
have  to  return  to  the  frigid  climes — frigid  in  more  ways  than  one — will 
miss  Phoenix  very  much,  and  I  want  to  convey  to  the  Reception  Com- 
mittee, to  the  governor  who  received  us,  and  the  various  officials,  the 
mining  kings,  the  consort  of  the  "Copper  Queen"  and  others  who  have 
made  our  stay  so  pleasant  here,  the  very  heartfelt  thanks  of  the  Con- 
gress, and  I  am  sure  that  every  delegate  will  join  me  in  this.  (Applause.) 

What  is  the  next  thing  you  have  on  your  desk,  Mr.  Secretary? 

SECRETARY  CALLBREATH:  I  presume,  Mr.  President,  the  Secre- 
tary also  ought  to  acknowledge  his  gratification  at  his  re-election,  and 
I  think  the  comparison  between  the  2^-pound  lemon  and  the  157-pound 
lemon,  while  entirely  inapplicable  in  the  case  of  the  President,  might 
well  be  applied  in  the  case  of  the  Secretary.  At  any  rate,  gentlemen, 
I  intend  to  perform  the  duties  of  the  office  as  best  I  may  during  the 
coming  year,  but  I  want  to  impress  upon  you  that  work  of  this  kind  is 


98  OFFICIAL     PROCEEDINGS 

work  that  cannot  be  done  by  one  man  or  two  or  three  or  a  dozen  men. 
The  work  must  ^  be  a  unanimous  uprising  and  demand  on  the  part  of  all 
of  the  mining  men  of  the  country.  Unless  there  is  that  hearty  co- 
operation, unless  each  of  you  feels  that  the  work  of  the  Secretary,  the 
work  of  the  President,  the  work  of  all  of  the  officers,  is  work  in  which 
you  are  directly  interested,  we  will  not  achieve  complete  success,  and 
when  you  see  that  we  are  making  errors  we  want  you  to  call  our  at- 
tention to  it,  because  remember  always  that  to  the  earnest  official 
honest  criticism  is  always  the  highest  compliment  and  the  best  aid. 
Whenever  your  officials  are  not  doing  what  they  ought  to  do  it  is  your 
province  to  call  their  attention  to  it.  You  may  be  mistaken,  and  when 
you  have  made  your  criticism  it  may  be  explained  to  you  why  you  are 
wrong  and  why  the  work  as  it  has  been  done  is  best,  under  the  best 
conditions.  You  cannot  help  but  understand  that  in  dealing  with  other 
people  we  have  sometimes  to  accept  compromises.  It  is  not  within  the 
province  of  any  one  or  all  of  us  to  attempt  to  dictate  to  Congress.  We 
cannot  even  attempt  to  dictate  to  one  single  congressman  and  do  it 
successfully,  because  we  may  not  know  exactly  the  surroundings  under 
which  he  is  forced  to  act,  and  we  have  to  do  the  best  we  can.  I  want 
to  say  that  I  deprecate  the  feeling  which  seems  to  prevail  in  many 
sections  that  members  of  Congress  and  senators  and  public  officials  are 
corrupt  or  subject  to  improper  influences.  As  a  matter  of  fact,  the  men 
who  go  to  Congress  are,  generally  speaking,  the  very  best  men  that 
can  be  selected.  Some  mistakes  are  made  but  usually  the  best  men  are 
elected.  On  the  whole  the  average  of  the  integrity  and  honesty  of  the 
members  of  Congress  and  the  Senate  is  of  the  highest  order,  and  there- 
fore, if  we  can  only  convince  them  that  our  cause  is  just  we  are  able 
to  get  their  support.  We  must  remember,  further,  that  to  convince 
every  member  of  Congress  that  a  certain  thing  is  important  and  should 
be  done  does  not  pass  a  bill  through  Congress.  It  is  only  in  some  great 
emergency  in  which  the  public  rise  up  en  masse  and  demand  legislation 
that  it  is  possible  to  pass  a  bill  within  several  months  in  Congress,  and 
every  congressman  is  yielding  to  the  force  of  public  sentiment  which  is 
behind  him  to  get  the  best  thing  he  can  for  his  constituents.  Unless 
you  as  mining  men  present  your  cause  in  convincing  way  you  cannot 
expect  members  of  Congress  to  leave  matters  on  which  they  are  being 
crowded  to  take  up  questions  for  which  there  seems  to  be  no  public 
demand.  If  we  expect  Congress  to  yield  to  our  wishes  we  must  not 
only  convince  them  that  we  are  right,  but  we  must  convince  them  that 
the  great  public  back  of  them,  their  constituency,  demand  the  things 
that  we  seek.  It  would  probably  take  six  months  even  though  there 
was  no  objection  on  the  part  of  anybody  to  get  Congress  to  indorse  the 
Lord's  Prayer  or  any  other  thing  which  they  thoroughly  believed  in. 
It  requires  a  little  pressure  all  the  time  to  keep  them  up  to  the  rack, 
to  see  that  they  do  not  forget,  because  they  must  necessarily  do  the 
things  which  come  to  them  with  the  greatest  demand.  This  shows  the 
great  necessity  of  organization  through  which  every  section  of  the  coun- 
try may  push  and  urge  upon  its  member  of  Congress  and  its  senator 
the  necessity  of  the  particular  legislation  which  we  recognize  to  be  so 
important. 

I  want  to  say  a  word  concerning  the  Kern-Foster  bill.  This  is  the 
bill  which  is  provided  for  in  one  of  the  resolutions  which  you  have  ap- 
proved providing  for  the  creation  of  metallurgical  research  stations  in 
the  West  and  providing  for  greater  means  of  safety,  with  particular 
reference  to  coal  mines.  I  presume  it  is  true  that  the  average  loss  of 
life  in  precious  metal  mines  is  as  great  as  in  coal  mines.  This  is  not 
generally  recognized,  because  of  the  fact  that  in  metal  mining  there  are 
usually  but  one  or  two  men  injured  at  a  time.  In  coal  mining  the 
horrible  disasters  command  the  attention  of  the  public.  The  rescue 
car  is  for  the  protection  of  the  lives  of  miners  in  all  kinds  of  mining. 
The  metallurgical  research  stations  are  especially  for  the  benefit  of  the 


AMERICAN     MINING     CONGRESS  99- 

Western  precious  metal  mining,  and  when  we  are  able  to  induce  the 
leader  of  the  Democratic  Senate  from  an  Eastern  state,  who  knows 
nothing  about  and  has  no  interest  in  precious  metal  mining,  to  father 
the  bill  for  your  benefit  and  urge  its  adoption  in  the  United  States 
Senate,  and  when  we  are  able  to  secure  an  Eastern  member  of  Congress 
who  has  nothing  to  do  with  metal  mining  and  no  personal  interest  in 
it  to  introduce  that  bill  in  the  House  and  get  back  of  it  with  his  com- 
mittee, you  can  see  that  we  have  gone  a  long  way  towards  getting  that 
support  which  is  necessary  to  secure  legislation.  But  we  need  more 
than  that;  we  need  to  show  that  there  is  a  real  demand  for  this.  And, 
gentlemen,  we  must  not  ask  upon  the  theory  that  the  mining  industry, 
because  of  its  importance,  is  entitled  to  it.  It  is  all  right  to  say  that, 
but  we  must  ask  for  it  because  the  mining  industry  needs  it,  and  unless 
the  mining  industry  can  show  its  need  then  it  is  not  entitled  to  ask  for 
this  legislation.  Congress  is  not  there  to  pay  tribute  to  people  who  have 
been  successful.  It  is  there  to  help  the  development  of  those  industries 
which  are  basic  in  the  business  life  of  the  country.  We  must  show  to 
Congress  that  the  mining  industry  needs  the  investigations  which  will 
enable  the  small  miner  to  prosecute  his  work  successfully.  If  we  can 
show  them  that  the  development  of  a  certain  ore  body  is  important  to 
the  public — and  we  must  never  lose  sight  of  the  fact  that  the  question 
is  not  how  it  affects  you  as  individuals  but  how  it  affects  the  country 
as  a  whole — if  you  as  an  individual  cannot  make  your  mine  successful, 
and  if  there  is  no  demand  on  the  part  of  the  public  that  you  shall  be 
successful,  then  it  is  a  proper  suggestion  that  you  go  into  some  other 
line  of  business;  but  if  the  production  of  your  mine  furnishes  the  basis 
of  the  industry  and  prosperity  of  the  country,  then  every  man  in  the 
United  States  is  interested  in  that  development.  We  must  show  that 
you  as  a  miner  need  this  scientific  investigation  to  enable  you  to  carry 
on  your  work  effectively,  efficiently,  with  the  greatest  safety  to  the  men 
employed  in  the  underground  work,  with  the  cheapest  production  which 
is  possible,  and  at  the  same  time  the  best  conservation  of  those  natural 
resources  which  you  did  not  create  and  which  were  placed  there  for  the 
benefit  of  the  world.  Safety,  Efficiency,  Conservation  are  the  three 
watchwords  of  the  American  Mining  Congress,  and  it  is  hoped  that  by 
co-operative  effort  on  the  part  of  the  mining  men  of  the  United  States 
these  things  may  be  accomplished.  As  has  been  said  this  morning,  vie 
must  not  expect  that  we  can  go  around  and  buttonhole  a  member  of 
Congress  and  pull  him  aside  and  by  some  improper  or  secret  method 
induce  him  to  be  with  us.  We  must  lay  our  case  before  him  with  the 
utmost  publicity,  and  we  must  do  that  not  only  in  the  nation  but  in 
the  state.  We  must  take  our  legislators  into  our  confidence  and  show 
them  that  the  public  is  interested  in  the  business  as  well  as  we  are. 
We  are  interested  in  making  a  profit;  you  are  interested  in  this  de- 
velopment and  in  the  men  we  employ,  and  the  men  themselves  are  inter- 
ested in  receiving  the  highest  wages  consistent  with  the  conditions  of 
the  business.  So  we  must  work  together,  and  I  hope  the  day  may  come 
when  this  conflict  between  employer  and  employe  will  cease,  because 
the  highest  development  of  the  mining  industry  can  never  be  secured 
until  the  mine  worker  and  the  mine  operator  work  squarely  together 
for  the  best  safety,  the  best  working  conditions,  the  best  living  con- 
ditions and  the  highest  wages  that  are  possible  to  be  paid  taking  other 
interests  into  consideration.  The  mine  operator  is  entitled  to  his  profit 
and  he  is  entitled  to  a  profit  in  proportion  to  the  risk  which  he  assumes 
in  the  carrying  out  of  his  business.  That  profit  must  be  enough  not 
only  to  pay  current  expenses  and  to  cover  this  risk,  but  to  cover  the 
value  of  his  mine,  which  sooner  or  later  will  be  depleted.  During  the 
time  of  its  operation  the  mine  and  plant  must  be  paid  for  from  the 
proceeds.  Having  met  those  two  conditions,  the  third  thing  is  that  the 
consumer  is  entitled  to  the  product  of  the  mine  at  the  lowest  price 
which  it  is  possible  to  furnish  it  to  him  for,  having  cared  first  for  the 


100  OFFICIAL     PROCEEDINGS 

miner  and  the  operator.  When  we  have  reached  the  condition  where 
there  is  a  most  perfect  co-operation  between  miner  and  operator  and 
where  the  great  public  outside,  which  are  the  consumers  of  the  products 
of  our  mines,  are  willing  to  say,  "We  will  pay  an  increased  price  for 
this  product  because  we  know  that  unless  the  mining  industry  is  profit- 
able we  cannot  be  prosperous;  we  are  willing  to  pay  a  price  which  meets 
all  these  other  conditions  and  makes  the  mining  industry  profitable,"  we 
can  say  that  we  have  succeeded  in  our  work. 

The  Kern-Foster  bill  provides  for  the  creation  of  metallurgical  re- 
search stations  in  the  West.  It  is  the  first  long  step  toward  an  effort 
to  apply  to  mining  the  highest  scientific  knowledge  which  the  world 
possesses.  It  may  be  and  probably  is  true  that  you  know  today  more 
than  anybody  else  does  about  your  own  mining  operations.  But  some 
man — and  there  are  today  a  number  of  men  who  have  been  dubbed  "bug 
hunters,"  who  can  go  into  a  plant  of  any  kind,  not  necessarily  a  mine, 
in  which  the  best  methods  are  not  in  use  and  point  out  different  plans 
of  operation  through  which  better  efficiency  can  be  secured.  We  want 
the  Bureau  of  Mines  to  pursue  such  investigations,  and  we  want  to  have 
them  show  us  the  better  and  more  efficient  methods  of  operation.  I 
remember  some  years  ago  when  we  were  in  the  Bureau  of  Mines  fight  in 
Washington,  in  the  early  days,  Mr.  Thomas  F.  Walsh,  who  was  known 
to  many  of  you,  invited  a  number  of  senators  and  representatives  to  his 
house  to  a  dinner.  There  were  about  forty  members  of  Congress,  and 
probably  about  twenty  senators,  and  the  others,  excepting  the  speaker, 
were  more  or  less  distinguished  men.  At  that  meeting  Mr.  Walsh  had 
upon  his  table  a  large  specimen  of  what  looked  like  a  silver-lead  ore. 
Mr.  Walsh  said:  "Gentlemen,  you  will  excuse  me  for  talking  shop  in 
my  own  home  and  to  my  guests,  but  I  can't  resist  the  temptation  to 
present  to  you  just  one  illustration.  This  piece  of  ore  is  from  a  mine 
that  has  been  in  operation  for  fifty  years.  During  that  time  it  has  been 
utilized  for  its  lead  and  silver  contents  only.  It  has  recently  been  dis- 
covered that  its  greatest  value  is  in  wolframite,  which  is  worth  more 
than  the  lead  and  silver  combined,  and  during  the  last  fifty  years  that 
ore  has  been  treated  only  with  reference  to  the  two  other  minerals." 
Some  one  might  say,  "Well,  who  cares  for  this  man  if  he  didn't  know 
enough  to  get  his  values?"  But  the  other  feature  of  it  is  that  the  use 
of  that  wolframite  would  greatly  extend  the  life  of  the  rails  which  are 
used  by  our  railroads.  The  railroads  must  charge  a  freight  or  passenger 
rate  which  would  keep  up  their  road,  and  do  you  not  see  where  you 
become  interested.  It  is  a  proposition  that  concerns  everybody,  and  it 
concerns  the  individual  miner  who  is  operating  in  the  mine.  Now,  it 
was  only  by  accident  that  the  presence  of  wolframite  in  that  ore  was 
discovered.  We  believe  the  federal  government  ought  to  undertake  on 
a  broad  scale  the  solution  of  every  problem  of  that  kind  to  the  end 
that  the  highest  efficiency  may  result  in  the  operation  of  the  mining 
industry,  and  to  that  end  we  want  your  support  to  pass  the  Kern- 
Foster  bill.  It  provides  for  a  beginning  of  that  work,  and  I  hope  that 
we  may  have  from  those  assembled  here  and  from  their  friends  as 
they  go  back  home  and  from  the  country  at  large  a  demand  that  this 
bill  shall  be  made  a  law  during  the  present  session  c-f  Congress. 

I  thank  you,  gentlemen,  very  much  for  your  kind  attention.  (Ap- 
plause.) 

THE  PRESIDENT:  To  fill  out  the  time  while  we  are  waiting  for 
the  Resolutions  Committee,  I  would  like  to  make  one  brief  remark  on 
the  duties  of  the  delegates,  which  I  brought  out  in  my  address — that  the 
duties  of  delegates  are  not  ended  by  coming  to  Phoenix  and  attending 
the  sessions  and  participating  in  the  entertainment,  of  which  we  had  a, 
very  good  example  last  night.  Those  are  merely  the  stage  settings. 
Your  work  is  upon  your  return  to  your  homes  when  you  should  report 
to  those  who  sent  you  here  the  work  of  this  Congress  and  commend  it 


AMERICAN     MINING     CONGRESS  101 

to  them  so  that  they  may  be  interested  and  know  that  they  sent  you 
with  good  results.  I  urge  upon  you  that  upon  your  return  you  write 
a  strong  letter  to  the  governor  or  the  respectiy^ 'iumojtities  ;whcTsent 
you  here  and  tell  them  what  you  found  arid/ (ioinnie'ad  to  them  the 
work  of  this  Congress.  (Applause.)  ,  „  ,  .>t.,^  ,,  v 

MR.  CARMICHAEL:  Mr.  President,  your  -Committee cm-  jftostlufcidas 
having  had  under  consideration  Resolution  No.  3,  introduced  by  L.  S. 
Judd  of  Vicksburg,  Arizona,  respectfully  recommend  its  adoption  as 
amended. 

Resolution  No.  3,  as  Amended,  Introduced  by  Mr.  L.  S.  Judd,  Vicksburg, 

Arizona. 

Whereas,  It  has  come  to  the  attention  of  the  American  Mining 
Congress  that  sundry  mining  claims  on  Indian  reservations  in  the  states 
of  Arizona  and  New  Mexico  are  unable  to  obtain  title  to  their  property 
by  reason  of  conflicting  surveys  made  many  years  since  covering  the 
boundaries  of  the  above  mentioned  Indian  reservations;  now,  therefore 

Be  It  Resolved,  That  this  Congress  respectfully  request  all  Western 
congressmen  and  senators  to  support  and  expedite  the  measure  now 
under  consideration  for  the  relief  of  those  suffering  by  reason  of  the 
existing  conditions. 

MR.  CARMICHAEL:  I  move  the  adoption  of  the  resolution  as 
amended. 

(Motion  seconded  and  carried  unanimously.) 

MR.  CARMICHAEL:  Mr.  President,  your  Committee  on  Resolutions 
submits  the  following  resolution  for  consideration  and  I  move  its  adop- 
tion: 

Resolution  A,  Introduced  by  the  Committee  on   Resolutions. 

Whereas,  The  American  Mining  Congress  was  originally  created  for 
the  specific  purpose  of  securing  the  active  co-operation  of  the  federal 
government  in  the  development  of  the  mining  industry;  and 

Whereas,  The  first  step  looking  to  such  co-operation  was  made 
effective  by  the  creation  of  the  federal  Bureau  of  Mines;  and 

Whereas,  The  results  accomplished  by  that  bureau  have  been  such 
as  to  commend  themselves  not  only  to  the  mining  men  of  the  country, 
but  to  all  those  who  realize  that  safety  and  efficiency  in  operations  and 
conservation  of  the  nation's  resources  are  matters  of  vital  importance 
to  the  nation  as  a  whole;  and 

Whereas,  The  means  at  its  disposal  are  inadequate  for  the  proper 
conduct  of  its  affairs  and  for  the  execution  of  well  considered  plans; 

Therefore  Be  Is  Resolved,  By  the  seventeenth  annual  meeting  of  the 
American  Mining  Congress,  assembled  at  Phoenix,  Arizona,  December 
7th  to  llth,  1914:  That  the  Congress  of  the  United  States  be  urged  in 
the  most  earnest  manner  to  provide  immediate  and  more  adequate  sup- 
port for  the  said  bureau. 

And  Be  It  Further  Resolved,  That  we  urge  on  the  Congress  of  the 
United  States  the  enactment  of  a  law  providing  for  the  creation  of  a 
department  of  mines  and  mining  with  its  head  a  member  of  the  Presi- 
dent's Cabinet. 

That  a  copy  of  this  resolution  be  transmitted  to  Congress  by  the 
President  and  Secretary  of  the  American  Mining  Congress  through  the 
proper  channels  at  once. 

(Motion  seconded  and  carried  unanimously.) 


102  OFFICIAL     PROCEEDINGS 

THE  PRESIDENT:  While  the  Committee  on  Resolutions  is  per- 
forming the  rest  of  its  work  I  would  like  to  amend  the  statement  I  made 
a  while /ago  regarcfii^the'  reports  of  the  delegates,  that  the  delegates 
who  have'  been  appointed'  by  the  President  of  the  United  States  will 
prepare  a  report  to  be  sent  'to  him,  and  I  am  going  to  ask  Dr.  Phillips, 
thfT .  gefQtJeirsaii'who  q"ac\ted  the  Bible  so  freely  last  night,  to  act  as 
ch'aifman  6f  that  committee.  Incidentally,  I  feel  it  proper  to  inform  you 
that  he  made  a  mistake,  I  think,  when  he  referred  to  books,  chapters  and 
verses  last  night,  because  I  have  looked  it  up  in  the  book  which  the 
Gideons  have  left  in  my  room,  and  I  have  concluded  that  he  must  have 
referred  to  the  mining  code  which  is  yet  unpublished  and  not  to  the 
Bible  (Laughter),  which  caused  me  more  or  less  loss  of  sleep. 

DR.  PHILLIPS:  I  feel  particularly  grateful,  Mr.  President,  that 
through  any  effort  of  mine,  even  though  they  were  not  intended,  you 
have  been  induced  to  read  a  portion  of  the  Holy  Scriptures.  (Laughter.) 

MR.  BASS:  Mr.  President,  I  would  like  to  take  this  opportunity  to 
express  my  personal  appreciation  of  the  able  manner  in  which  the  offi- 
cers of  the  Mining  Congress  have  conducted  the  business  of  the  Con- 
gress, and  I  think  we  ought  to  be  proud  to  think  that  we  have  such 
officers;  and  not  expressing  the  feeling  of  the  people  of  Phoenix  par- 
ticularly, but  of  the  whole  state  of  Arizona,  I  believe  that  every  citizen 
will  feel  proud  that  we  have  had  the  honor  of  this  Congress. 

Now,  our  worthy  doctor  here,  I  think,  is  entitled  to  consideration 
for  that  address  we  had  last  night,  because  he  probably  has  not  had  a 
chance  lately  to  look  into  the  Scriptures,  and  I  don't  think  you  ought  to 
call  him  down  on  that,  Mr.  President,  at  all.  I  enjoyed  it  very  much 
myself. 

I  heard  a  statement  here  the  other  day  by  one  of  the  members  that 
he  thought  that  Arizona  mountain  land  wasn't  worth  anything  only  for 
mining;  that  if  it  wasn't  good  for  mining  it  wasn't  good  for  anything 
else.  I  felt  like  getting  up  and  making  the  statement  then  that  I 
believe  we  can  build  sanitariums  on  every  acre  of  it,  and  when  our 
Eastern  friends  need  the  benefit  of  a  health-giving  climate  we  can  keep 
them  out  here  for  six  months  and  they  never  will  want  to  go  back.  When 
I  first  came  here  I  was  an  invalid.  I  came  out  here  to  die,  and  have 
been  here  thirty-one  years.  I  wrote  a  little  advertisement  of  our  climate 
and  for  the  benefit  of  our  members  I  will  give  it  to  you: 

If  your  health  should  fail  and  your  pulse  grow  weak, 
And  your  doctor  advises  you  some  clime  to  seek, 

Do  not  be  discouraged  nor  sit  down  and  cry, 

Arizona  will  save  you,  with  her  climate  so  dry. 

Our  pure  air  will  revive  you,  sunshine  give  new  life 
And  strength  to  prepare  you  for  all  future  strife; 

But  then  we  are  mortals  and  surely  must  die, 

And  in  our  blissful  climate  you  can  hang  up  and  dry. 
(Laughter.) 

MR.  SIZER:  Mr.  President,  I  believe  the  delegates  here  this  morn- 
ing would  like  to  hear  from  Mr.  Frank  Murphy. 

MR.  MURPHY:  I  think  it  is  hardly  fair  to  ask  me  to  stand  up  in 
the  presence  of  many  able  gentlemen  who  have  talked  to  you  here  at  this 
convention.  It  has  not  been  my  privilege  to  be  with  you  all  through, 
so  I  am  not  thoroughly  advised.  I  have,  however,  formed  some  impres- 
sions from  the  little  that  I  have  heard  that  lead  me  to  feel  greatly  en- 
couraged so  far  as  the  mining  interests  of  Arizona  are  concerned  and 
the  general  business  interests  in  our  state.  Arizona  has  suffered  ma- 
terially and  all  the  United  States  has  suffered  from  a  lack  of  serious 


AMERICAN     MINING     CONGRESS  103 

interest  on  the  part  of  business  men  in  the  politics  of  our  country. 
Arizona  is  not  altogether  a  mining  country,  though  manifestly  rich  in 
that  particular;  but  we  have  great  agricultural  possibilities,  and  there 
is  a  conflict  of  political  interest  and  ambitions  running  through  this  state 
that  have  brought  about  us  a  very  unpleasant  condition  of  things,  very 
injuriously  affecting  the  interests  of  our  state.  I  believe  from  what  I 
have  heard  here  in  the  day  or  two  that  I  have  been  with  you,  and  the 
talks  that  have  been  made,  and  from  conversation  with  different  parties, 
that  a  movement  is  on  foot  by  which  the  big  and  little  interests  of  our 
state  are  going  to  take  hold  of  these  important  matters,  and  that  great 
good  will  result.  I  am  particularly  anxious  to  see  something  of  the 
kind  take  place,  and  if  the  disposition  in  evidence  is  properly  directed, 
I  would  expect  to  see  Arizona  move  ahead  with  leaps  and  bounds  gratify- 
ing to  all  people  interested  in  the  state,  and  neighboring  states  as  well. 
The  justification  and  importance  of  prompt  action  towards  the  bettering 
of  conditions  in  this  state,  has  been  thoroughly  brought  to  your  attention. 
I  do  not  know  of  anything  in  particular  that  I  can  say  at  this  time.  The 
subject  under  consideration  has  been  gone  into  very  carefully  and  ap- 
preciatively, by  those  fully  qualified  to  determine  the  line  of  procedure 
necessary.  I  have  lived  here  for  thirty-eight  years,  and  been  somewhat 
identified  with  development  of  the  resources  of  the  state,  and  naturally 
feel  a  great  interest  in  its  future. 

I  am  sorry  to  have  to  say  that  during  the  past  few  years  the  radical 
political  epidemic  that  has  been  so  hurtful  throughout  the  entire  United 
States,  fastened  itself  on  Arizona  in  the  most  destructive  way  imagin- 
able. Scheming  politicians,  never  constructive,  living  off  of  what  has 
been  created,  taxing  everything  now  existing  and  prospective  to  the 
limit,  and  mischievously  working  hardships  on  those  who  have  been 
conspicuous  in  the  development  of  the  resources  of  the  state,  have  been 
able  to  deceive  the  wage-earner  and  thoughtless  business  man  generally, 
to  an  alarming  extent,  but  I  am  pleased  to  be  able  to  feel  that  a  change 
for  the  better  confronts  us.  I  think  the  time  has  arrived  for  the  poli- 
ticians of  the  country  to  get  busy  and  use  such  brains  and  intelligence 
as  they  possess,  in  at  least  trying  to  create  something  to  tax,  instead  of 
throwing  all  kinds  of  obstacles  and  objections  around  the  people  who  are 
doing  business,  and  producing  the  wealth  of  the  country,  maintaining 
pay  rolls  and  trying  to  create  a  healthy  and  prosperous  condition  through- 
out the  country.  (Applause.) 

THE  PRESIDENT:  We  will  be  glad  to  hear  further  from  the 
Resolutions  Committee. 

MR.  CARMICHAEL:  Mr.  President,  right  in  line  with  the  remarks 
of  the  last  speaker,  the  committee  submits  the  following  resolution  for 
consideration  by  the  Congress: 

Resolution  No.  B,  Introduced  by  the  Committee  on  Resolutions. 

Whereas,  The  mining  industry  can  only  reach  its  highest  develop- 
ment through  more  complete  co-operation  between  the  miner,  the  oper- 
ator and  the  various  interests  through  wrhich  mines  are  developed  and 
the  products  thereof  are  prepared  for  and  transmitted  to  market;  and 

Whereas,  The  present  condition  of  the  mining  industry  is  such  that 
all  unnecessary  restrictions  should  be  removed  and  every  aid  and  en- 
couragement be  given  through  just  and  farseeing  legislation;  and 

Whereas,  The  development  of  the  mining  industry  has  at  times  been 
greatly  hampered  by  unwise  and  illy  considered  laws,  placing  thereon 
unfair  restrictions  and  undue  burdens  which  have  seriously  hampered 
the  industry  as  a  whole. 

Whereas,  Many  of  these  unfortunate  laws  have  been  passed  without 
a  comprehensive  knowledge  of  conditions;  now,  therefore, 


104  OFFICIAL,     PROCEEDINGS 

Be  It  Resolved,  By  the  American  Mining  Congress  in  its  Seventeenth 
Annual  Convention  assembled  at  Phoenix,  Arizona,  that  all  connected 
with  the  mining  industry  be  urged  to  take  a  more  active  interest  in 
proposed  legislation,  and  through  proper  organizations  or  otherwise,  see 
that  all  legislators  and  the  people  generally  are  given  full  information 
as  to  the  experience  of  other  states  with  legislation  similar  to  that  which 
may  be  proposed,  and  be  given  all  available  information  which  may 
lead  to  an  accurate  forecast  of  the  effects  of  such  proposed  measures. 

MR.  CARMICHAEL:     I  move  the  adoption  of  the  resolution. 
(Motion  seconded  and  carried  unanimously.) 

DR.  PHILLIPS:  I  do  not  wish  to  impose  on  my  Arizona  friends, 
because  I  am  an  old  Arizona  pioneer  myself.  I  was  in  Arizona  many 
years  ago  with  a  diamond  drill  outfit  which  I  carried  in  on  a  pack  mule 
across  the  range.  It  was  about  the  time  that  the  great  discoveries  of 
oil  in  California  and  Beaumont  induced  us  to  discontinue  our  work,  be- 
cause coal  could  not  at  that  time  compete  with  oil. 

Gentlemen,  with  the  permission  of  the  President  and  in  your  inter- 
est, I  would  ask  to  speak  a  few  words  concerning  the  director  of  the 
Bureau  of  Mines.  I  suppose  I  am  his  oldest  friend  here,  because  I  have 
known  him  intimately  for  about  thirty-two  years.  I  do  not  know  of  any 
man  who  has  led  a  life  of  greater  usefulness,  nor  one  whose  devotion 
to  the  public  interests  of  this  country  can  for  a  moment  be  compared 
with  that  of  Dr.  Holmes.  I  betray  no  secrets  when  I  say  that  his  health 
has  failed  under  the  tremendous  burdens  imposed  upon  him  by  the  duties 
of  this  position.  Last  spring,  contrary  to  the  advice  of  his  physician, 
he  went  to  Alaska  at  a  time  of  the  year  when  the  waters  were  still  cold. 
He  ate  and  slept  very  little.  He  worked  twenty-four  hours  a  day  part 
of  the  time,  and  spent  many  nights  sleeping  in  wet  blankets  or  as  he 
could.  This  has  brought  upon  him  a  serious  attack  of  illness  from  which 
his  recovery  will,  I  think,  be  somewhat  slow.  When  I  visited  him  a 
month  ago  at  Fort  Bayard  I  was  distressed  by  his  condition,  but  I  am 
pleased  to  remark  that  now  he  appears  to  be  on  the  upgrade.  Gentlemen, 
I  can  recommend  this  man  to  you  from  a  knowledge  stretching  over  a 
third  of  a  century.  There  are  but  few  men  in  the  United  States  like 
Dr.  Holmes,  the  director  of  the  Bureau  of  Mines  (great  applause),  and 
I  know  what  I  am  talking  about,  because  I  have  known  him  intimately 
since  he  came  to  the  University  of  California  fresh  from  Cornell  Uni- 
versity as  a  recent  graduate.  There  is  not  a  man  of  my  acquaintance 
who  has  shown  half  of  the  devotion  to  the  public  service  or  brought 
to  the  solution  of  the  problems  which  he  has  faced  for  years  so  much 
intelligence,  perseverance  and  insistence.  He  is  one  man  among  a  thous- 
and. Modest,  kind-hearted,  with  a  heart  as  big  as  all  outdoors,  he  knows 
nothing  but  the  public  good.  If  he  borrowed  $10  from  you  today  he 
would  spend  it  for  the  Bureau  of  Mines.  He  not  only  spends  his  own 
money  but  everything  else  he  can  get  hold  of.  He  is  the  most  intemperate 
man  I  ever  saw  in  my  life;  he  has  no  regard  for  his  health,  his  comfort 
or  anything  else  but  the  work  to  which  he  has  devoted  his  life;  and  I 
move  you,  Sir,  that  as  an  appreciation  of  his  services  this  Congress  go 
on  record  as  expressing  the  utmost  sympathy  for  him  in  his  present 
indisposition,  with  the  most  heartfelt  wish  that  he  will  soon  be  restored 
to  complete  health.  (Applause.) 

(Motion  seconded  and  carried  unanimously  by  a  rising  vote.) 

THE  PRESIDENT:  Mr.  Day  is  called  upon  to  address  the  Congress 
on  the  general  subject  of  the  interests  of  mining. 

MR.  DAY:  Mr.  President,  I  must  respectfully  ask  to  be  excused. 
I  do  not  feel  that  I  can  say  anything  at  this  time  that  would  be  of  in- 
terest to  you  gentlemen. 

THE  PRESIDENT:     We  will  excuse  you  reluctantly. 


AMERICAN     MINING     CONGRESS  105 

MR.  DERN:  Mr.  President,  it  has  just  occurred  to  me,  after  listen- 
ing to  the  remarks  of  the  gentlemen  who  have  spoken  this  morning, 
remarks  which  conform  to  much  of  the  sentiment  expressed  throughout 
this  session,  that  there  is  one  thought  that  we  might  take  home  with  us, 
and  that  is  that  we  seem  to  be  getting  into  the  habit  of  ascribing  all  of 
our  ills  to  hostile  legislation.  In  my  judgment  there  is,  if  anything,  too 
much  stress  laid  upon  that  particular  point.  Our  discussions  have 
tended  to  convey  the  idea  that  the  only  thing  that  is  the  matter  with  the 
mining  industry  is  that  there  have  been  a  lot  of  bad  laws  passed.  I  do 
not  mean  to  defend  the  legislation  that  has  been  complained  of.  I  do 
not  say  that  the  laws  have  not  been  bad;  but  I  do  say  that  personally 
I  do  not  believe  that  these  laws  are  the  sole  cause  of  our  troubles.  And 
in  my  opinion  we  are  laying  ourselves  open  to  the  charge  of  being  short- 
sighted and  narrow-minded  if  we  permit  ourselves  to  become  obsessed 
with  this  notion.  The  people  of  Arizona,  the  mining  men  particularly, 
seem  to  be  finding  a  good  deal  of  fault  with  some  of  the  recent  legis- 
lation in  this  state,  and  they  have  given  us  the  impression,  in  some 
degree,  that  if  they  were  rid  of  this  obnoxious  legislation,  everything 
would  be  well  with  them.  I  never  heard  of  this  legislation  until  I  came 
to  this  Congress,  and  I  am  far  from  denying  that  our  Arizona  friends 
have  a  grievance,  but  I  should  like  to  call  attention  to  one  point.  Arizona 
(s  generally  considered  an  extremely  radical  state,  whilst  Utah  is  char- 
acterized as  an  extremely  conservative  state.  In  Utah  we  have  not  had 
any  of  the  radical  legislation  that  we  find  so  bitterly  denounced  here. 
And  yet  I  venture  to  say  that,  on  the  whole,  mining  conditions  in  Utah 
are  very  much  the  same  as  they  are  in  Arizona.  Hence  I  say  that  if 
we  look  at  the  matter  in  a  broad  way  we  must  conclude  that  there  must 
be  something  the  matter  with  mining  besides  these  laws  that  have  been 


One  of  the  chief  things  that  is  the  matter  with  mining  just  now,  as 
we  all  know,  is  the  low  metal  market,  and  that,  of  course,  is  a  matter 
over  which  the  states  have  no  control,  and  consequently  this  is  one  of 
our  ills  for  which  legislation  is  in  no  wise  responsible. 

But  I  do  not  intend  to  take  the  time  to  attempt  to  say  what  is  the 
matter  with  mining.  Many  valuable  suggestions  have  been  made  on 
this  subject  during  the  present  session.  My  general  opinion  is  that  "the 
old  order  changeth,"  that  mining  is  getting  upon  a  different  basis  than 
it  used  to  be.  The  easy  picking  is  all  gone.  The  old  method  of  going 
out  on  the  hills  and  finding  a  mine,  and  developing  it  with  small  capital, 
is  past.  The  country  has  been  pretty  well  prospected  over,  and  mining 
is  entering  upon  a  different  stage.  The  scale  of  operations,  the  methods, 
the  treatment  of  ores,  and  so  forth,  have  got  to  be  changed;  and  until 
the  country  adapts  itself  to  these  changed  conditions  there  probably 
will  be  some  hesitancy  in  mining  development.  For  this  reason  I  think 
we  ought  to  remember  that  our  chief  function  is  not  so  much  to  criticize 
what  we  might  term  hostile  legislation — although  such  criticism,  of 
course,  is  perfectly  legitimate — but  we  should  be  constructive  in  our 
views.  We  should  endeavor  to  evolve  measures  that  will  meet  the  new 
conditions,  and  that,  of  course,  is  one  of  the  very  reasons  why  we  want 
the  Bureau  of  Mines  more  adequately  supported  and  its  scope  of  oper- 
ations enlarged.  That  is  the  reason  the  Mining  Congress  has  been  so 
much  interested  in  the  Bureau  of  Mines;  and  I  think  we  can  do  more 
for  the  mining  industry  by  enlarging  the  scope  of  that  bureau,  and  by 
helping  to  frame  constructive  legislation,  than  we  can  by  adopting  a 
dog-in-the-manger  policy  and  simply  kicking  about  everything  else  that 
is  done. 

I  suppose  it  is  true  that  there  is  a  good  deal  of  legislation  that  is  ill- 
considered.  I  suppose  some  of  the  men  sent  to  the  legislature  simply 
come  back  and  say  they  have  voted — something  like  the  story  I  heard 
not  very  long  ago  of  the  old  German  who  belonged  to  the  Knights  of 


106  OFFICIAL     PROCEEDINGS 

Columbus.  He  went  back  to  his  home  town  after  a  considerable  absence 
and  decided  he  would  visit  the  lodge.  Meanwhile  they  had  built  a  new 
building  with  two  or  three  lodge  rooms  in  it.  The  building  was  pointed 
out  ito  him,  and  he  went  upstairs,  and  got  into  the  wrong  room.  The 
lodge  was  in  session,  but  there  was  nobody  at  the  door,  so  he  walked 
right  in.  Just  as  he  got  in  the  door  he  saw  a  man  at  the  head  of  the 
room,  sitting  at  a  table,  rapping  on  the  table  with  a  gavel,  and  saying, 
"Brothers,  step  up  and  vote!  Don't  keep  us  waiting;  we  are  in  a 
hurry!"  He  walked  up  to  a  little  table  in  the  middle  of  the  room  and 
saw  a  box  with  a  lot  of  black  and  white  balls.  He  dropped  in  a  white 
ball,  and  just  then  somebody  hollered,  "Who  are  you?"  "What  are  you 
doing  here?"  and  he  said,  "Who  am  I?  Didn't  I  be  a  Knight  of  Columbus 
for  fourteen  years?  Vy  shouldn't  I  wote?"  And  they  hollered,  "Raus 
mit  him!"  When  he  told  it  afterwards  he  said:  "Dey  trew  me  oud,  unt 
put  a  man  py  der  door  so  I  couldn't  get  back  in  again  anymore.  But 
anyhow  I  woted;  but  vat  I  woted  for  I  don't  know."  (Laughter.) 

I  suppose  that  is  the  way  some  legislators  work,  and  when  they 
go  home  they  can  say,  "Anyhow,  I  voted."  But  if  they  do  not  know 
what  they  voted  for,  is  it  not  often  our  own  fault?  Do  we  always  do 
our  share  to  inform  them?  Perhaps  not;  and  perhaps  also,  we  do  not 
always  look  at  our  own  questions  from  a  broad  enough  public  viewpoint. 
Perhaps  the  legislator  thinks  a  good  deal  the  same  way  about  us,  that 
we  come  together  in  a  Mining  Congress,  and  in  the  course  of  three  or 
four  days  dispose  of  a  lot  of  big  questions  that  specialists  spend  their 
lives  upon;  and  we  pass  a  lot  of  resolutions  that  we  never  heard  of 
before  and  that  we  have  only  considered  a  few  minutes;  and  then  we 
go  home,  thinking  that,  anyway,  we  voted,  though  when  we  examine 
ourselves  closely  we  must  admit  that  what  we  voted  for  we  know  very 
little  about.  One  of  the  chief  benefits  that  we  might  derive  from  the 
American  Mining  Congress,  especially  now  that  a  monthly  journal  is 
to  be  sent  to  all  its  members,  is  to  educate  us  on  these  questions,  so 
that  we  will  be  better  equipped  to  consider  them  in  a  broad,  fair  spirit. 

I  think  there  are  two  sides  to  this  question  of  cussing  the  legislator, 
and  we  ought  to  be  broad-minded  and  charitable  enough  at  least  to  give 
the  other  fellow  credit  for  good  intentions,  even  if  we  will  not  concede 
that  he  had  good  judgment.  We  should  bear  in  mind  that  one's  opinion 
of  a  question  always  depends  upon  his  point  of  view.  I  believe  the 
average  legislator  tries  to  do  his  duty,  and  I  am  very  much  impressed 
with  the  temperate  tone  of  the  resolution  passed  a  little  while  ago,  in 
which  mining  men  were  urged  to  interest  themselves  more  in  legis- 
lation. I  think  if  we  mining  men  would  do  that,  instead  of  holding  our- 
selves aloof  from  men  in  government  positions,  or  from  legislators,  and 
would  get  into  close  contact  with  them,  so  as  to  give  them  the  fullest 
information,  and  present  our  side  of  the  case  frankly,  thoroughly  and 
fully,  we  would  find  that  the  average  legislator  is  willing  to  be  convinced. 
(Applause.) 

THE  PRESIDENT:  Gentlemen,  it  is  with  great  reluctance  that  I 
am  going  to  call  for  the  introduction  of  the  last  resolution,  which  Mr. 
Carmichael  has  been  withholding,  and  I  want  to  thank  the  members  for 
their  patience  and  the  kind  consideration  they  have  extended  to  me  as 
presiding  officer  of  this  meeting.  I  know  my  own  shortcomings  much 
better  than  you  can  tell  me,  and  therefore  I  greatly  appreciate  the  help 
with  which  you  have  supported  me  in  this  work.  It  has  been  coming 
almost  too  easy  to  be  true,  and  I  expected  much  more  opposition  than 
we  have  had,  and  I  thank  you  most  cordially  for  the  kind  consideration 
which  you  have  extended  to  me.  We  will  now  hear  from  Mr.  Carmichael 
once  more. 

MR.  CARMICHAEL:  Mr.  President,  your  committee  presents  the 
following  resolution: 


AMERICAN     MINING     CONGRESS  107 

Resolution  C,  Introduced  by  the  Committee  on  Resolutions. 

Whereas,  The  success  attending  the  Seventeenth  Annual  Session  of 
the  American  Mining  Congress,  held  at  Phoenix,  Arizona,  December 
7-llth,  1914,  has  been  due  in  a  great  measure  to  the  excellent  arrange- 
ments made  for  the  meetings  and  to  the  hospitality  extended  to  the 
members  of  the  Congress  by  the  citizens  of  Phoenix. 

Now,  Therefore  Be  It  Resolved,  That  the  Congress  hereby  expresses 
its  deep  appreciation  of  the  help  and  entertainment  extended  to  it,  and 
its  hearty  thanks  to  all  concerned,  especially  the  Phoenix  Board  of 
Trade  and  local  committees,  through  whose  untiring  efforts  is  due 
largely  the  success  of  the  meeting;  also  to  the  citizens  of  Phoenix  gen- 
erally, for  the  many  courtesies  extended  to  the  members  during  their 
stay. 

MR.   CARMICHAEL:      I  move  the  adoption  of  the  resolution. 
(Motion  seconded.) 

SECRETARY  CALLBREATH:  May  I  suggest  to  the  committee  that 
much  assistance  was  rendered  in  this  work  by  some  of  the  companies 
and  cities  outside  of  Phoenix,  and  I  think  they  ought  to  be  included  in 
this  resolution.  If  the  chairman  will  consent  that  the  resolution  be 
amended  so  that  it  will  read  to  the  citizens  of  Arizona  and 

MR.  CARMICHAEL:  This  places  me  in  a  slightly  embarrassing 
position,  Mr.  Secretary.  Speaking  more  as  an  Arizona  delegate,  I  am 
sure  that  the  rest  of  the  delegates  and  those  in  Arizona  who  have 
assisted  towards  making  the  meeting  of  the  Congress  a  success,  appre- 
ciate the  sentiment  which  the  Secretary  has  so  gracefully  expressed,  and 
if  the  Congress  sees  fit  to  amend  the  resolution  in  such  a  way  I  am  sure 
the(  rest  of  my  committee  will  acquiesce. 

SECRETARY  CALLBREATH:  I  only  make  this  suggestion  because 
I  happen  to  know  that  a  good  deal  of  the  money  which  was  subscribed 
to  make  this  convention  possible,  was  subscribed  by  outside  people 
whose  support  was  very  important  in  making  a  success  of  the  movement, 
and  I  feel  that  they  ought  to  be  recognized. 

THE  PRESIDENT:  We  all  appreciate  the  delicate  position  of  the 
chairman  of  the  Committee  on  Resolutions.  All  those  in  favor  of  the 
adoption  of  the  resolution  as  read  will  signify  by  saying  aye.  Contrary. 

(Carried  unanimously.) 

THE  PRESIDENT:  The  next  order  is  the  photograph  to  be  taken 
outside,  the  visit  to  the  mineral  exhibit  and  the  automobile  ride,  also 
the  safety  demonstration  here  this  evening  at  8  o'clock,  and  the  business 
of  the  Seventeenth  Annual  Session  of  the  American  Mining  Congress 
is  now  declared  to  be  adjourned. 

Convention   adjourned  sine  die  at  12  o'clock. 


MEETING  OF  MEMBERS 


TUESDAY,   DECEMBER  8,   1914. 
Evening  Session,  7:30  O'clock  P.  M. 

THE  PRESIDENT:  Gentlemen,  you  will  please  come  to  order.  This 
is  the  annual  meeting  of  the  members.  The  first  order  of  business  Is 
the  reading  of  his  report  by  the  Secretary. 

SECRETARY  CALLBREATH:     The  report  is  as  follows: 

AMERICAN    MINING    CONGRESS 

Secretary's  Financial  Report,  October  1,  1913,  to  November  30,  1914. 
Cash  on  hand  October  1,  1913 ' $      130.06 

RECEIPTS. 

Membership    dues    $  3,493.90 

Membership  fees    600.00 

Life  memberships   ' 1,500.00 

Special  contributions    4,600.00 

Deficiency  contribution    500.00 

Phoenix  Convention  contribution 5,000.00 

Reimbursement  by  Philadelphia   Convention  fund..  682.56 

Balance   Chicago   advertising  fund 33.85 

Rebate  on  railroad  ticket 4.30 

Miscellaneous 5.00 

Total  receipts   16,419.61 

Total  to  be  accounted  for $16,549.67 

EXPENDITURES. 

Secretary's  salary,  March,  1911-July,  1912 $  5,100.00 

Rent  Washington  office 510.00 

Stenographer 972.00 

Postage 1,025.10 

Printing 550.60 

Multigraph  and  letter  service 251.63 

Office   equipment    222.26 

Secretary's  traveling  expense  and  incidentals  Wash- 
ington office,  including  telephone  and  telegraph, 
stationery,  District  of  Columbia  taxes  and  extra 

stenographic  service   1,385.88 

Audit  Philadelphia  accounts 50.00 

Rent  Denver  office 337.50 

Exchange  on  deposits  in  Denver  bank 28.45 

Assistant   Secretary's   salary 800.00 

Traveling  expenses  Assistant  Secretary  (including 
advances)  account  organization  State  Chapters 

and    Phoenix    Convention 1,042.15 

Taxes,  Denver  2.40 

Commission  and  expense  advertising  1914  Booklet..  810.37 

Securing    memberships    95.00 

Refund  of  dues  paid  twice 10.00 


AMERICAN     MINING     CONGRESS  109 


Expense  of  previous  year: 

Secretary's  expense  account,  April  and 

May,  1913   $302.15 

Expense  account  Booklet,  Philadelphia 

Convention 55.00 


Total 357.15 


Total   expenditures    $13,550.49 

Less  advances  by  Secretary  included  in  above  for 

which  he  has  not  been  reimbursed 88.61 


Total   payments    $13,461.88 

Covered  by  National  Metropolitan  vouchers  1  to  59.$  4,082.01 
Covered  by  First  National,  Denver,  1,299  to  1,353. . .     9,379.87 


$13,461J 


Cash  on  hand  November  30,  1914 $  3,087.79 

On  deposit  as  follows : 

In  National  Metropolitan  Bank,  Washington $  1,017.99 

In  First  National  Bank,  Denver,  Colo 2,049.80 

In  office 20.00 


$  3,087.79 

ADDITIONAL  RESOURCES. 

Accounts  Receivable: 

Advertisements  in  Phoenix  Convention  Booklet $  2,470.50 

American  Tempering  Co.   (Philadelphia  Exposition) 15.00 


LIABILITIES. 

Half-tones   and  cuts,  1914   Booklet $       41.10 

Printing   1914   Booklet 522.61 

R.  L.  Humphrey,  director  Philadelphia  Exposition: 

Balance  claimed  due  for  service $571.40 

Less    paid    by    Secretary 25.00 

Less  charge  for  photographs 15.00 

531.41 

Due  Secretary: 

Balance  on  expense  vouchers  to  Nov.  1,  1914 88.61 

November  expense  voucher 182.17 

Salary  August,  1912  to  November,  1912 — %  year  at  $3,600. .     1,200.00 
Salary  December,  1912,  to  November,  1914 — 2  years  at  $6,000  12,000.00 
Respectfully  submitted, 

J.  F.  CALLBREATH,  Secretary. 

We  hereby  certify  that  we  have  examined  the  cash  book,  vouchers 
and  bank  accounts  of  the  American  Mining  Congress  as  kept  by  J.  F. 
Callbreath,  Secretary,  and  that  the  foregoing  financial  statement  of  re- 
ceipts and  expenditures  is  correct  as  set  forth  in  said  records. 

The  statement  for  November  of  the  account  in  the  First  National 
Bank,  Denver,  Colorado,  is  not  yet  at  hand,  but  the  statement  showing 
balance  November   1,   1914,   was    found  to   be   correct. 
Respectfully, 

HARVEY  S.  CHASE  &  COMPANY, 
By  HOWARD  C.  BECK,  C.  P.  A.,  Local  Manager. 
Washington,  D.  C.,  December  1,  1914. 


110  OFFICIAL     PROCEEDINGS 

SECRETARY  CALL-BREATH:  I  might  say  that  the  item  of  $88.63 
which  appears  as  a  liability  was  a  mistake  in  the  footing  of  my  personal 
expenditures,  my  footing  being  that  much  less  than  the  actual  amount, 
which  was  discovered  by  the  auditor  in  his  examination  of  the  accounts. 
I  must  confess  that  the  auditor  has  convicted  me  of  being  a  very  poor 
bookkeeper.  The  receipted  vouchers  are  accompanied  by  the  cancelled 
checks  with  which  the  payment  was  made  during  the  time  covered  by 
the  report.  I  think  that  everything  is  available  here  for  an  examination 
of  the  accounts.  Up  to  this  year,  we  have  always  had  an  Auditing  Com- 
mittee which  has  gone  over  the  accounts  monthy  and  audited  the  bills. 
For  the  past  year  this  has  been  practically  impossible  because  the  only 
members  we  have  in  Washington  are  in  official  life  who  could  not  under- 
take to  audit  the  bills,  and  as  most  of  the  business  has  been  done  in 
that  office  during  the  past  year,  or  practically  all  of  it,  it  has  been  im- 
possible to  have  anybody  there  who  could  audit  those  accounts.  It  has 
been  necessary  for  the  Secretary  to  go  ahead  and  transact  the  business. 
I  turn  over  the  vouchers  and  books,  and  I  ask,  Mr.  President,  that  a 
committee  be  appointed  to  audit  these  accounts.  For  several  years  here- 
tofore I  have  asked  for  the  appointment  of  an  Auditing  Committee,  and 
the  convention  has  never  granted  the  request,  upon  the  theory  that  an 
Auditing  Committee,  having  already  gone  over  and  approved  each  of 
the  bills,  further  accounting  was  not  necessary  other  than  the  examina- 
tion by  an  accountant.  I  feel  now  that,  in  view  of  the  fact  that  no  one 
has  approved  any  of  these  bills  during  the  year,  there  ought  to  be  an 
Auditing  Committee  appointed  to  go  over  the  account. 

THE  PRESIDENT:  I  will  ask  Mr.  George  H.  Utter  and  Mr.  F.  K. 
Brunton  to  act  as  Auditing  Committee  and  take  these  accounts  and  go 
over  them  and  report  back  to  us  what  they  find. 

MR.  GERALD  SHERMAN:  Mr.  President,  I  move  that  the  report 
be  accepted  as  read. 

MR.  F.  H.  O'BRIEN:     I  second  the  motion. 
THE  PRESIDENT:     Without  the  auditing? 

MR.  SHERMAN:     Yes. 

(Motion  seconded  and  carried  unanimously.) 

THE  PRESIDENT :  The  next  item  of  business  comes  under  Section 
3  of  Article  5,  consisting  of  the  selection  of  a  Nominating  Committee. 
'That  section  reads  as  follows: 

For  the  purpose  of  facilitating  the  selection  of  Directors,  there  shall 
be  elected  at  the  annual  meeting  of  the  members,  a  committee  of  five 
members  to  be  known  as  a  Nominating  Committee,  whose  duty  it  shall 
be  to  present  to  the  members  for  their  consideration  the  names  of  such 
persons  as  such  committee  may  deem  advisable  to  act  as  Directors  for 
the  ensuing  year. 

MR.  IMER  PETT:  Mr.  President,  I  take  pleasure  in  nominating 
Mr.  Arthur  Thomas  of  Utah. 

THE  PRESIDENT:  Are  there  any  other  nominations?  There 
should  be  five  names. 

MR.  DAY:  I  would  like  to  place  in  nomination  the  name  of  Mr. 
Seeley  W.  Mudd  of  California. 

MR.  DERN:     I  would  like  to  nominate  Mr.  W.  G.  Swart  of  Colorado. 

MR.  O'BRIEN:  I  would  like  to  put  in  nomination  Mr.  Gerald  Sher- 
man of  Arizona. 

MR.  TALMAGE:     I  nominate  Mr.  George  H.  Utter  of  New  Mexico. 


AMERICAN     MINING     CONGRESS  111 

THE  PRESIDENT:  Are  there  any  further  nominations,  gentlemen? 
(No  response.)  Since  no  further  names  are  forthcoming  the  nomina- 
tions will  be  considered  closed. 

(The  candidates  placed  in  nomination  were  unanimously  elected.) 

SECRETARY  CALLBREATH:  Mr.  President,  it  has  been  suggested 
by  quite  a  number  of  the  delegates  that  we  may  be  able  to  finish  our 
business  and  adjourn  on  Thursday  night,  finishing  up  the  work  of  the 
Resolutions  Committee,  instead  of  having  them  report  again  on  Friday 
morning.  I  think  it  would  be  wise  to  take  the  sense  of  the  members  as 
to  whether  they  would  like  to  have  the  business  so  arranged  as  to  finish 
Thursday  night  or  to  go  over  until  the  Friday  morning  session. 

THE  PRESIDENT:  The  chair  will  be  glad  to  entertain  discussion 
on  that  subject.  The  prorgam  for  Friday  morning  is  short,  and  as  a 
good  many  prefer  to  leave  on  Thursday  night  rather  than  Friday  morn- 
ing, I  would  be  glad  to  have  the  sense  of  the  meeting  on  that  point.  Are 
there  any  suggestions 

MR.  JESSE  KNIGHT:  I  move  that  we  finish  up  on  Thursday  if 
possible. 

(Motion  seconded  and  carried  unanimously.) 

SECRETARY  CALLBREATH:  I  would  like  to  make  one  suggestion 
to  the  Nominating  Committee,  and  that  is,  that  in  making  their  nom- 
inations they  so  arrange  that  there  will  be  two  directors  at  the  same 
place  or  so  near  each  other  that  it  will  be  convenient  for  them  to  get 
together  as  the  Executive  Committee  in  order  to  transact  the  business 
of  the  committee.  As  you  understand,  in  an  organization  of  this  kind, 
with  its  directors  scattered  from  one  end  of  the  country  to  the  other, 
must  have  its  executive  power  lodged  somewhere,  and  it  is  necessary 
that  the  Executive  Committee,  under  our  by-laws,  can  meet,  because  our 
directors  can  very  seldom  get  together  except  at  the  annual  meetings 
in  sufficient  numbers  to  constitute  a  quorum.  The  Executive  Committee 
under  our  by-laws  is  authorized  to  act  on  behalf  of  the  Board  of  Directors, 
and  our  custom  has  been  that  when  a  new  matter  needing  the  approval 
of  the  directors  comes  up  it  is  submitted  to  them  by  letter,  and  their 
letter-vote  upon  that  subject  is  turned  over  to  the  Executive  Committee, 
which  has  the  legal  power,  under  the  by-laws,  to  make  effective  the  sug- 
gestion or  recommendation  of  the  members  of  the  board.  It  is  necessary 
to  have  two  men  who  can  conveniently  get  together  to  make  effective 
the  recommendations  of  the  Board  of  Directors. 

MR.  SHERMAN:  I  would  like  to  know  if  there  are  any  particular 
rules  for  the  nominations.  Are  the  nominations  of  the  Nominating  Com- 
mittee to  be  final,  or  are  the  members  at  liberty  to  add  other  members 
to  the  nominations? 

THE  PRESIDENT:  Other  nominations  will  be  put  to  the  house  and 
voted  upon  in  the  event  any  nominations  made  by  the  Nominating  Com- 
mittee are  not  acceptable. 

I  believe  the  next  business  in  order  is  the  amendment  of  the  by- 
laws. I  will  ask  the  Secretary  to  read  the  proposed  amendment  to  the 
by-laws. 

SECRETARY  CALLBREATH:  Our  by-laws  are  amended  by  thirty 
days'  notice  to  each  of  the  members  and  then  by  vote  of  the  members 
thereon.  The  following  amendment  has  been  proposed: 

That  Section  1  of  Article  3  be  amended  by  striking  out  the  whole 
of  said  section  and  substituting  in  lieu  thereof  the  following: 

Section  1.  There  shall  be  three  classes  of  members,  to  be  known 
respectively  as  Active  Members,  Subscribing  Members,  and  Associate 


112  OFFICIAL     PROCEEDINGS 

Members.  Active  Members  alone  shall  be  eligible  to  hold  office  and 
Active  and  Honorary  Members  alone  shall  be  entitled  to  vote. 

Active  Members.  Any  person  associated  with  mining,  whose  appli- 
cation for  membership  has  been  approved  by  the  Committee  on  Mem- 
bership, and  who  shall  pay  an  initiation  fee  of  $15  shall  become  an 
Active  Member  of  this  Congress  and  thereafter  shall  pay  in  advance  an 
annual  fee  of  $10;  and  during  the  term  for  which  said  dues  have  been 
paid,  such  member  shall  be  entitled  to  all  the  rights  and  privileges  of 
membership. 

Subscribing  Members.  Any  corporation  or  organization  or  co- 
partnership actively  engaged  in  or  interested  in  mining  may,  with  and 
by  the  approval  of  the  Committee  on  Membership,  be  admitted  as  a 
Subscribing  Member  upon  such  terms  and  conditions  as  the  Board  of 
Directors  may  determine.  Such  Subscribing  Members  shall  not  be  en- 
titled to  vote,  but  shall  be  entitled  to  receive  all  of  the  publications  of 
the  Congress  and  to  receive  abstracts  of  all  data,  statistics  and  legal  or 
technical  information  which  may  be  in  the  files  of  the  Congress,  and  to 
have  such  special  reports  covering  inquiries  as  may  be  made  from  time 
to  time  and  which  the  Secretary  or  his  assistants  may  be  able  to  furnish 
concerning  any  matter  upon  which  the  Congress  may  have  special  in- 
formation. The  membership  of  Subscribing  Members  shall  continue 
only  during  the  term  for  which  the  dues  of  such  member  as  fixed  by 
the  Board  of  Directors,  has  been  paid. 

Notice  of  this  proposed  amendment  was  mailed  from  the  Washing- 
ton office  November  7,  1914,  to  all  of  the  members. 

THE  PRESIDENT:  You  have  heard  the  reading  of  the  proposed 
amendment  to  the  by-laws.  What  is  your  pleasure?  Is  there  any  dis- 
cussion on  the  subject? 

SECRETARY  CALLBREATH:  I  might  say,  Mr.  President,  that  of 
the  members  who  have  voted  by  letter-vote  there  are  372  votes;  two 
have  been  cast  against  the  proposed  amendment  and  370  in  favor  of  it. 
These  votes  in  nearly  every  instance  are  in  favor  of  the  proposed  amend- 
ment, with  any  amendments  germane  thereto,  so  that  in  case  it  is 
thought  wise  to  amend  this  proposed  amendment  by  any  slight  change 
it  would  be  in  order  to  have  it  done  and  these  370  votes  still  count  in 
favor  of  its  adoption. 

THE  PRESIDENT:  What  is  your  pleasure,  gentlemen,  with  re- 
gard to  this  amendment?  We  would  like  to  have  some  discussion  or 
motion  on  the  subject  for  or  against. 

MR.  E.  L.  WOLCOTT  (Assistant  Secretary):  Mr.  President,  while 
the  amendment,  to  those  of  us  who  have  studied  this  question,  is  very 
plain,  I  have  talked  with  some  members  who  do  not  understand  the  gist 
of  it.  I  would  like  to  ask  that  the  Secretary  go  a  little  more  into  detail 
and  analyze  it,  as  it  were,  so  that  the  delegates  present  will  understand 
just  why  we  are  endeavoring  to  bring  about  this  kind  of  an  amendment. 

MR.  PRESIDENT:     We  will  hear  from  the  Secretary. 

SECRETARY  CALLBREATH:  Mr.  President  and  Members:  I  am 
afraid  I  will  be  obliged  to  anticipate  something  I  had  expected  to  say 
later  in  the  evening  under  the  general  discussion.  The  plan  proposed 
is  for  the  purpose  of  having  a  larger  membership.  There  are  many 
people  who  feel  like  contributing  to  and  supporting  the  work  in  the 
localities  but  who  do  not  feel  like  paying  the  amount  of  dues  which  is 
necessary  to  be  an  active  member  of  the  Congress.  It  is  proposed  to 
increase  largely  the  membership,  both  for  the  purpose  of  keeping  in 
touch  with  the  Washington  work,  through  the  local  members,  who  can 
be  called  upon  to  assist  when  there  is  something  which  needs  outside 
support,  and  again,  that  they  may  have  strong  working  chapters  within 


AMERICAN     MINING     CONGRESS  113 

the  various  states.    It  has  been  desired  for  a  number  of  years  that  we 
should  create  state  organizations,  because  while  it  has  been  important 
that  the  legislative  matters  at  Washington  should  be  looked  after,  it  is 
equally  important  that  legislative  matters  within  the  states  should  be 
looked  after  on  behalf  of  the  mining  industry.     I  think  the  mining  con- 
dition, as  you  who  are  in  Arizona  know,  points  clearly  to  the  necessity 
in  all  of  the  states  of  a  strong  working  mining  men's  organization  which 
shall   see   to   it  that   legislators,   when   they   undertake  to   legislate   on 
behalf  of  the  mining  industry,  shall  understand  the  conditions  and  shall 
understand  what  certain  legislation  means.     In  this  state  I  am  told  you 
bave  a  law  which  will  practically  close  down  some  of  the  mines  because 
it  prohibits   the   employment   of   men   who  are   not  citizens.     As    your 
President  said  to  you  last  night,  legislation  of  this  character  is  sort  of 
catching;   one  state  passes  a  law  which  appeals  to  a  vicious  or  selfish 
minority,  and  people  of  that  same  caliber  in  the  adjoining  states,  selfish 
or  vicious  as  the  case  may  be,  undertake  to  pass  similar  legislation,  pos- 
sibly not  for  the  benefit  of  the  state  but  in  order  that  they  may  appeal 
to  the  populace  as  being  heroes  in  their  behalf;   so  that  in  all   of  the 
states  we  have  bad  legislation,  and  the  fact  has  been  pointed  out  today 
in  the  discussion  of  mine  taxation  is  quite  generally  true,  that  no  two 
states  have  the  same  theory  of  legislation.    In  one  state  you  assess  your 
property  upon  one  basis  and  in  another  state  upon  an  entirely  different 
basis.     In  Colorado  our  tax  law  provides  that  assessments  upon  mining 
property  shall  be  at  its  full  cash  value  plus  all  of  the  net  output  and 
one-half  of  the  gross  output.     In  Arizona  you  have  a  similar  law,  except 
the  ratios  are  different.     Now,  the  ratio  which  is  right  in  one  state  is 
right  in  another  state,  and  one  of  them  is  certainly  wrong  as  applied 
to  the  same  character  of  mining.     Proposals  are  being  put  forward  in 
the  several  states  by  people  who  do  not  understand  the  business  and  do 
not  realize  how  much  hardship  it  will  entail,  do  not  realize  how  much 
of  a  burden  is  going  to  be  put  upon  the  industry  and  how  much  of  that 
burden  will  fall  directly  upon  the  people  whom  the  legislation  is  supposed 
to  benefit.     So  that  it  is  necessary  in  each  of  the  states  that  we  have 
strong  working  organizations.     The  proposed  plan  is  that  the  national 
organization  shall  ask  from  each  of  those  who  join  $2  a  year,  and  for  that 
it  is  proposed  to  publish  a  monthly  journal  which  will  go  to  them  for 
the  $2.     It  is  following  largely  the  plan  of  the  National   Geographical 
Society  of  Washington,  which,  with  its  $2,  sends  the  National  Geographic 
Magazine,  and  their  membership   has   grown  to  enormous   proportions. 
We  do  not  hope  for  a  membership  anything  like  as  great  as  that  of  the 
National  Geographical  Society,  because  that  appeals  to  all  classes.     We 
do  hope    to    bring    together    in     the  American  Mining  Congress  all  of 
those    people    within    the    different    states    who    are    interested    in    the 
progress  and  development  of  the  mining  industry,  giving  to  them  a  jour- 
nal which  possibly  not  at  first  but  in  a  very  short  time  will  be  fully 
worth  the  $2  which  is  paid,  granting  to  those  associate  members  the 
right  to  become  members  of  the  state  chapter  by  an  additional  fee  to 
be  imposed  by  the  state  chapter.     My  suggestion   is  that  they  should 
pay  25  cents  a  month  or  $3  a  year,  making  the  total  $5  a  year,  and  giving 
the  state  chapter  $3  with  which  they  can  employ  a  secretary  who  will 
be  continually  looking  out  for  the  interests  of  the  mining  men  of  the 
state.     I  do  not  think  it  is  ever  possible  to  have  a  strong  organization 
unless  there  is  provision  made  for  some  one  who  is  able  to  give  his 
entire  time  to  the  work.     We  have  hoped  through  this   plan   that  we 
could  cement  together  all  of  the  people  who  are  interested  in  the  mining 
industry,  that  we  could  keep  them  posted  as  to  what  is  going  on,  and 
through  their  being  advised  as  to  the    different   classes   of   legislation 
which  are  proposed  in  the  various  states  they  will  be  able  to  meet  the 
situation  better  than  they  could   acting  independently  as   we   are  now 
doing.    The  American  Mining  Congress  is  the  first  great  effort  to  create 
:a  national  organization  of  mining  men  along  these  lines,  and  the  work 


114  OFFICIAL     PROCEEDINGS 

which  has  been  done  thus  far  has  met  the  approval  of  at  least  those 
who  are  nearest  to  where  the  work  has  been  done  and  know  most  about 
it.  The  Monthly  Bulletin  which  we  published  for  a  time  we  were 
obliged  to  discontinue  because  of  the  lack  of  funds.  The  result  is  that 
we  have  no  method  of  communicating  with  our  membership  except  by 
personal  letter,  and  that  is  too  expensive.  Consequently  members  have 
wondered  what  we  were  doing.  If  I  could  explain  to  you  all  the  things 
we  have  been  doing,  I  know  that  in  the  main  you  would  approve  what 
has  been  done  and  would  feel  that  at  least  some  good  had  been  ac- 
complished. But  this  new  plan  is  to  create  a  great,  strong  membership, 
and  we  are  hoping  that  a  campaign  may  be  organized  at  this  meeting 
by  which,  in  each  of  the  mining  states  of  the  West,  a  strong  working 
mining  organization  may  be  created  capable  of  presenting  to  the  legis- 
lative bodies  the  real  truth  respecting  mining  and  in  that  way  preventing 
the  legislation  which  is  of  a  character  detrimental  to  the  mining  business 
as  a  whole.  It  is  proposed  now  that  this  journal  shall  receive  adver- 
tising, and  through  the  advertising  it  is  hoped  to  make  a  profit  for  con- 
tinuing the  work  of  the  national  organization.  It  is  hoped  that  the 
members  of  the  organization  will  stand  by  the  journal  to  the  extent  that 
they  will  be  a  little  more  friendly  to  the  mining  machinery  manufacturers 
and  supply  dealers  who  patronize  its  advertising  columns.  If  the  mining 
men  of  the  country  would  stand  loyally  by  a  plan  of  that  sort,  the 
journal  would  furnish  a  good  deal  of  profit  through  which  the  national 
work  could  be  financed.  Now,  it  is  proposed  in  this  journal  not  to  get 
into  competition  with  the  trade  journals  now  published  for  the  benefit 
of  the  mining  industry.  For  years  it  has  been  proposed  that  we  publish 
a  magazine  of  this  kind,  and  I  have  always  been  opposed  to  it  because 
of  the  fact  that  we  could  not  afford  to  lose  the  support  of  the  mining 
trade  journals,  and  I  felt  that  they  might  possibly  feel  that  our  receiving 
advertisements,  to  some  extent  possibly  in  competition,  was  not  fair  and 
would  feel  that  they  could  not  afford  to  support  our  work.  I  have  taken 
this  matter  up  with  a  number  of  them,  and  there  seems  to  be  no  objec- 
tion of  that  kind,  particularly  in  view  of  the  fact  that  we  do  not  propose 
to  enter  their  field  in  the  editorial  line.  The  purpose  is  to  keep  our 
members  advised  as  to  proposed  legislation  affecting  their  interests  in 
Washington  and  in  the  various  states.  We  shall  attempt  to  keep  a  record 
of  the  decisions  of  the  courts  which  affect  the  mining  industry;  we 
shall  also  try  to  keep  up  to  date  on  the  administration  rulings  with 
reference  to  the  mining  industry  in  the  departments  at  Washington,  and 
in  that  way  furnish  the  information  along  legislative  lines  which  our 
members  ought  to  have  and  which  they  cannot  get  in  any  other  way. 
We  hope,  in  addition  to  that,  to  make  the  journal  an  advocate  of  the 
Safety  First  movement,  through  which  we  may  hope  to  bring  about 
better  service  in  the  prevention  of  loss  of  life  and  injury  to  limb  in  the 
mining  industry.  Those  are  the  proposed  purposes  of  the  new  journal, 
and  in  view  of  the  fact  that  we  hope  it  will  be  worth  the  $2  to  our  mem- 
bers we  believe  we  ought  to  receive  a  very  large  membership,  and  if 
these  men  are  all  in  one  organization  we  are  in  very  much  better  position 
to  secure  legislative  support  and  indorsement  than  by  being  scattered 
in  our  efforts.  I  think  that  explains  the  purpose  of  this  amendment. 
It  is  a  little  doubtful  in  my  mind  whether  this  amendment  is  clear 
enough,  that  the  associate  member  will  not  be  permitted  to  vote  in  the 
national  organization.  The  members  of  the  national  organization  who 
do  have  a  right  to  vote  pay  $10  a  year  dues,  and  in  consequence  of  that 
they  are  a  part  of  our  corporation  and  they  have  a  right  to  vote  upon 
the  election  of  all  the  directors  and  all  of  the  business  of  the  organiza- 
tion. It  is  not  intended  that  the  associate  member  shall  have  the  right 
to  vote  in  the  national  organization.  He  is  eligible  to  vote  in  the  state 
organization.  The  state  organization  itself  shall  be  the  sole  judge  of  the 
qualifications  of  its  members,  and  if  somebody  happens  to  pay  $2  and 
becomes  a  member  of  the  national  organization  he  does  not  become  a 


AMERICAN     MINING     CONGRESS  115 

member   of  the   state   chapter   unless   the   state   chapter   is   willing    to 
admit  him. 

MR.  PETT:  Mr.  President,  I  now  move  that  the  amendment  as  read 
be  adopted. 

(Motion  seconded  and  carried  unanimously.) 

SECRETARY  CALLBREATH:  Wait  a  minute.  I  desire,  as  proxy, 
to  cast  130  votes  for  the  amendment,  and  203  of  the  proxies  have  desig- 
nated either  Mr.  Scholz  or  myself,  both  names  being  upon  the  proxies, 
so  that  Mr.  Scholz  and  myself,  with  his  permission,  will  cast  203  votes. 
Mr.  Scholz  has  30  votes  to  cast  if  he  sees  fit  to  cast  them  in  that 
behalf. 

THE  PRESIDENT:     They  are  all  cast. 

Our  program  calls  for  a  discussion  of  the  needs  of  the  western  min- 
ing industry  and  plans  through  which  its  higher  development  may  be 
fostered.  This  discussion  was  to  be  led  by  Dr.  Holmes,  and  I  am  informed 
that  Dr.  Holmes  is  unable  to  come  out  at  this  time,  and  he  has  asked 
that  he  be  excused  from  leading  the  discussion  and  has  asked  Mr.  Call- 
breath  to  open  the  discussion  in  his  place.  I  am  very  sorry  it  is  not  my 
pleasure  to  introduce  Dr.  Holmes  tonight;  he  is  recuperating  from  a 
very  serious  attack  of  bronchial  trouble  brought  on  by  exposure  and 
overwork,  and  we  have  endeavored  to  keep  him  indoors  as  much  as  pos- 
sible and  to  guard  against  further  exposure.  I  am  now  going  to  call 
upon  Mr.  Callbreath  to  open  the  discussion. 

SECRETARY  CALLBREATH:  Mr.  President,  if  I  may  be  permitted 
before  touching  upon  the  other  subject — or,  rather,  in  the  middle  of  it, 
because  I  have  partially  completed  what  I  have  to  say  along  that  line 
in  reference  to  the  amendment — I  desire  to  say,  concerning  Dr.Holmes, 
that  his  illness  is  entirely  the  result  of  too  intense  loyalty  to  your 
interests.  I  have  known  many  hard-working  men,  and  I  have  known 
Dr.  Holmes  very  intimately.  I  have  never  known  a  man  who  put  in 
half  the  hours  in  the  cause  which  he  had  at  heart,  the  development  of 
the  mining  industry,  that  Dr.  Holmes  has  devoted  to  the  service.  I  am 
sure  that  we  all  hope  for  his  final  recovery,  because  I  should  regard 
that  if  he  were  incapacitated  for  work  the  nation  would  lose  its  most 
faithful  and  most  efficient  servant.  (Applause.) 

I  have  outlined  to  you  one  of  the  plans  through  which  we  hope  to 
expand  the  influence  of  the  Congress,  and  through  which  we  hope  to 
help  out  the  finances,  through  the  proceeds  from  the  journal. 

Another  plan  which  is  proposed — a  plan  which  has  been  followed  by 
other  organizations — is  to  create  a  bureau  of  mining  economics,  which 
will  gather  information  about  every  possible  phase  of  practical  mining, 
which  will  keep  in  touch  with  markets,  which  will  get  all  of  the  infor- 
mation that  is  necessary  to  be  furnished  either  to  the  prospector  who 
begins  his  work,  to  the  operator,  or  to  the  engineer  who  wants  special 
information  along  a  certain  line  which  is  outside  of  his  professional 
specialty,  which  will  keep  the  legal  phases  and  decisions  classified  so 
that  they  will  always  be  available,  which  will  collect  information  as  to 
production  and  cost  of  production  in  every  branch  of  the  mining  industry 
and  be  able  to  furnish  data  to  all  who  wish  it  about  any  phase  of  mining. 
This  has  been  a  dream  of  my  own  for  a  long  time.  I  did  not  know 
until  recently  that  the  railroads  of  this  country  maintained  exactly  such 
a  bureau  in  the  same  building  in  which  our  Washington  office  is  lo- 
cated. They  are  spending  in  the  neighborhood  of  $100,000  annually  in 
the  collection  and  preparation  of  the  information  which  is  there  avail- 
able. They  are  prepared  to  furnish  any  inquirer  the  information  bear- 
ing upon  any  particular  transportation  question.  The  value  of  this 
.service  has  recently  been  demonstrated.  The  railroads  of  the  United 


116  OFFICIAL    PROCEEDINGS 

States,  because  of  the  increased  wages  and  the  increased  cost  of  ma- 
terial, asked  for  an  advance  in  freight  rates,  while  on  the  other  hand 
the  Interstate  Commerce  Commission  was  requiring  reductions,  so  that 
the  railroad  companies  found  themselves  between  the  upper  and  nether 
millstones.     After  a  lengthy  hearing  the  Interstate  Commerce  Commis- 
sion admitted  their  statement  but  seemed  to  be  of  the  opinion  that  the 
railroads  had  better  practice  economy,  but  suggested  that  the  passenger 
rates  might  be  advanced,  that  they  believed  that  the  railroads  from  this 
source,  from  the  economy  practiced  on  the  one  side  and  the  increased 
amount  received   from  passenger  traffic,  could  make  up  the  deficiency 
which  seemed  to  face  them.     The   Bureau  of  Railroad  Economics  fur- 
nished  information.     It  was   sent  broadcast,   and  the   people   began   to- 
talize that,  in  this  country,  we  desire  and  demand  the  very  best  service 
that  can  be  given,  were  expecting  that  perfect  service  from  corporations 
which  were  hampered  by  increased  expenses  on  one  side  and  reduced 
returns  upon  the  other;   that  condition  prevailing  at  a  time  when  the 
business  of  the  country  as  a  whole  began  to  contract  and  lessen;   the 
railroads  were  in  a  position  where  it  seemed  they  could  not  make  the 
improvements  necessary  and  keep  up  their  rolling  stock  and  roadbeds. 
The  result  has  been  a  reopening  of  that  case  and  the  railroads  will  have 
another  chance  to  be  heard  and  another  chance  to  get  what  they  believe 
they  ought  to  have.   Now,  what  I  have  said  does  not  mean  that  I  believe 
they  ought  to  have  the  advanced  rates  or  that  they  ought  not  to  have 
them,  but  I  do  say  that  they  ought  to  have  enough  of  a  rate  to  enable 
them  to  pay  the  costs  which  are  necessary  to  be  paid,  to  furnish  those 
appliances  which  will  protect  the  lives  of  their  patrons  and  reduce  the 
loss  of  life  among  their  employes  to  a  minimum,  and  enable  them  to 
give  to  you  and  to  me  and  to  the  people  of  this  country  that  efficient 
service  which  we  demand.    It  was  because  they  had  this  bureau  in  oper- 
ation for  a  number  of  years  that  they  were  able  to  present  this  informa- 
tion in  such  a  way  as  to  secure  what  they  desired.     Now,  it  has  been 
proposed  to  establish  a  bureau  of  mining  economics  along  the  same  line, 
not  upon  so  broad  or  comprehensive  a  scale,  but  it  was  estimated  by  the 
Committee  on  Ways  and  Means  appointed  at  the  Philadelphia  conven- 
tion last  year,  after  a  careful  examination  of  the  matter,  that  such  a 
bureau  would  cost  about  $25,000  a  year,  and  it  was  proposed  at  that  time, 
and  our  by-laws  were  amended  to  meet  that  situation,  to  provide  for 
another  class  of  memberships  to  be  known  as  corporate  memberships. 
It  was  proposed  that  the  larger  mining  corporations  should  pay   into 
a  fund  on  the  basis  of  their  production  an  amount  which  would  make  up 
enough  money  to  pay  for  the  cost  of  this  bureau  of  mining  economics. 
The  Mining  Congress  for  a  number  of  years,  as  you  have  seen  by  the 
financial  report,  has  gone  along  creating  a  deficit.     This  report  shows 
that  during  the  last  year,  while  our  expenses  have  been  greater  than 
ever  before,  we  have  paid  all  of  our  expenses  and  reduced  the  deficit 
by  several  hundred  dollars.     I  might  say  that  a  good  deal  of  the  credit 
for  that  is  due  to  our  President,  Mr.  Scholz.     We  hope  to  extend  the 
general   system  of  membership   as  far  as  possible;   we  hope  to  create 
the  special  memberships  to  such  an  extent  as  will  enable  us  to  maintain 
the  organization  and  at  the  same  time  to  create  organizations  within  the 
several  states  willing  and  able  to  meet  all  state  questions.     We  hope 
through   the  corporate   memberships   to   establish   a   bureau   of   mining 
economics  through  which  any  member  of  Congress  or  senator  or  anyone 
else   who    desires    information    along    any   mining    line    can    secure    it 
promptly  and  accurately.     With  all  these  different  plans  which  are  now 
before  us,  with  the  record  of  one  year  of  more  than  meeting  our  expenses, 
although  greater  than  usual,  the  officers  of  the  American  Mining  Con- 
gress feel  encouraged  to  go  forward.     There  have  been  times  when  it 
has  seemed  that  we  ought  to  stop,  and  some  of  our  good  friends  have 
thought  we  might  better  stop;   but  we  haven't  stopped;    we  have  con- 
tinued;  and  we  hope  that  the  future,  with  the  earnest  support  of  the- 


AMERICAN     MINING     CONGRESS  117 

mining  men  of  the  West,  will  put  us  upon  the  basis  that  we  will  not 
only  deserve  respect  but  will  be  able  to  command  it.    I  thank  you,  gentle- 
men, for  listening  so  patiently.     (Applause.) 
(Mr.  Phillips  in  the  chair.) 

CHAIRMAN  PHILLIPS:  Mr.  President  and  Fellow  Members:  You 
have  heard  the  very  happy  reference  which  has  been  made  by  our  Secre- 
tary, Mr.  Callbreath,  to  the  good  work  that  has  been  done  by  our  Presi- 
dent, Mr.  Carl  Scholz  of  Chicago.  A  large  part  of  the  financial  efficiency 
of  the  last  fourteen  months  is  due  to  hii  efforts,  and  I  think  it  very 
timely  that  Mr.  Scholz  should  favor  us  with  his  views  as  to  what  should 
be  done  for  the  good  and  welfare  of  the  Mining  Congress.  (Applause.) 

THE  PRESIDENT:  Mr.  Chairman,  Ladies  and  Gentlemen:  I  greatly 
appreciate  the  remarks  made  by  the  Secretary  as  to  my  efficiency,  but  I 
assure  you  he  has  greatly  overestimated  my  work;  and  if  I  have  done 
anything  it  has  been  one  for  the  Mining  Congress  and  two  for  myself. 
Like  everybody  else,  I  am  selfish  in  my  motives,  and  my  interests  and 
work  were  not  entirely  for  your  benefit  but  for  my  own  and  for  the 
companies  I  represent.  I  referred  last  night  to  the  fact  that  the  coal 
people  out  here  are  in  the  minority.  I  think  there  are  very  few,  perhaps 
less  than  a  dozen,  representatives  of  the  coal  industry  here.  At  Phila- 
delphia last  year  we  had  quite  the  opposite;  there  were  few  metal  men 
and  many  coal  men;  and  I  think  it  proper  that  I  again  refer  to  the  fact 
as  to  why  the  coal  people  have  taken  such  an  interest  in  this  work. 
My  first  appointment  as  a  delegate  to  the  American  Mining  Congress 
dates  back  to  1900.  At  that  time  I  was  located  in  West  Virginia,  and 
the  conditions  at  that  time  did  not  quite  permit  my  trip  to  Milwaukee, 
although  I  was  quite  anxious  to  visit  that  famous  town;  but  later  on  I 
was  again  appointed  a  delegate  to  the  Congress  at  Pittsburgh,  which  I 
attended  and  became  greatly  interested  in  the  work,  I  saw  a  certain 
analogy  between  the  efforts  of  the  Mining  Congress  and  those  which 
the  coal  people  had  been  exerting  along  the  same  lines,  but  I  am  sorry 
to  say  without  success.  Later  on  I  was  called  upon  to  assist  in  the  work 
of  establishing  the  Bureau  of  Mines,  and  that  was  my  first  active  con- 
nection with  the  work.  I  was  greatly  surprised  at  the  opposition  to  that 
work,  which  we  now  generally  recognize  as  one  of  the  best  undertakings 
we  have  fostered,  manifested  by  senators  and  congressmen — not  all  of 
them,  but  a  certain  faction  which  was  very  much  opposed  to  any  gov- 
ernment aid  in  fostering  the  mining  industry,  which  they  thought  was 
entirely  for  gain,  and  I  shall  never  forget  the  chilly  reception  we  received 
at  the  hands  of  some  of  our  foremost  senators.  I  didn't  blame  them 
very  much,  because  they  didn't  know  the  needs  of  the  industry,  and  I 
was  surprised  how  little  effort  it  took  to  fully  convince  them  that  they 
had  been  wrong  and  make  converts  of  them  for  our  cause.  While  my 
work  was  very  limited,  I  am  very  glad  that  we  finally  succeeded  in 
establishing  the  Bureau  of  Mines,  because  you  all  appreciate  what  has 
been,  done  by  it.  Likewise  it  was  my  pleasure  to  assist  in  the  estab- 
lishment of  a  School  of  Mines  in  the  state  of  Illinois.  Unfortunately,  I 
offered  a  short  resolution  at  a  meeting  of  a  fuel  committee  that  we 
should  have  a  mining  school.  Had  I  been  better  posted  I  think  I  should 
have  kept  my  seat.  But  once  I  got  my  foot  into  it  I  made  up  my  mind 
the  school  would  have  to  be  established,  and  while  it  took  some  effort, 
I  think  in  less  than  two  months  the  legislature  of  Illinois  appropriated 
the  amount  and  the  school  has  been  in  operation  for  four  or  five  years 
and  has  done  a  great  deal  of  good.  It  is  one  of  the  very  satisfactory 
schools  that  we  now  have  in  Illinois. 

The  coal  people  had  made  several  efforts  to  bring  about  co-operative 
work,  but  we  didn't  have  very  much  success.  Several  of  my  friends 
appreciated  that  the  Mining  Congress  had  an  established  machinery 
which  could  be  made  good  use  of  and  we  participated  in  the  delibera- 


118  OFFICIAL     PROCEEDINGS 

tions  of  the  Congress  and  allied  ourselves  with  it.  I  am  glad  to  say  that 
out  of  the  $10,000  which  we  collected  last  year  the  coal  mining  industry 
contributed  the  larger  proportion,  being  something  like  $6,000,  against 
$4,100  coming  from  the  metal  mining  industry.  So  you  can  see  that 
we  endeavored  to  pay  you  back  for  the  money  which  you  invested  in 
establishing  this  machinery,  and  I  feel  sure  in  saying  that  the  coal 
people  in  the  future  are  going  to  be  just  as  anxious,  and  more  so  I  believe, 
to  contribute  their  part  of  the  expense.  I  want  to  assure  you  that  we 
didn't  want  to  take  away  something  you  had  established;  we  wanted  to 
help  you  to  make  it  more  effective  and  more  useful,  and  we  Very  much 
hope  that  we  will  be  able  to  show  you  our  appreciation  not  by  promises 
but  by  cold  cash. 

I  think  that  covers  the  most  essential  point  I  wanted  to  bring  out, 
excepting  that  I  again  want  to  urge  the  necessity  of  attending  to  legis- 
lative affairs.  I  myself  am  not  a  politician,  excepting  by  force,  but  I 
have  found  that  if  we  do  not  interest  ourselves  in  politics  somebody  else 
who  doesn't  care  as  much  for  the  effect  as  we  do  will  do  the  work  for 
us  and  will  not  do  it  as  well  as  we  think  it  ought  to  be  done,  and  in 
talking  to  some  of  you  people  here  today  I  was  surprised  that  a  gentle- 
man who  was  a  delegate  and  also  a  member  did  not  know  that  we  were 
doing  much  work  in  Washington.  Candidly,  the  main  part  of  the  work 
has  been  done  by  the  Secretary.  I  made  three  or  four  trips,  and  I  became 
convinced  that  we  have  a  very  excellent  standing  among  the  congressmen 
and  senators  in  Washington  now.  We  go  before  them  and  tell  them 
our  troubles  and  they  listen  in  a  very  patient  way  and  always  give  us 
a  very  cordial  reception.  I  think  they  are  much  warmer  toward  us  and 
our  cause  now  than  they  were,  because  they  realize  that  we  do  not  ask 
for  things  we  are  not  entitled  to,  but  that  we  are  simply  asking  for 
things  we  must  have  and  need,  and  by  presenting  our  cause  clearly  and 
strongly,  and  with  the  backing  of  such  a  large  number  of  members  as 
we  ought  to  have  I  feel  quite  sure  that  we  can  make  our  cause  felt  much 
better  in  the  future  than  we  have  in  the  past.  There  are  some  of  you 
gentlemen  to  follow,  and  I  am  not  going  to  tire  your  patience  any  longer, 
and  I  thank  you  very  much  for  the  hearing  you  have  given  me.  (Great 
applause.) 

CHAIRMAN  PHILLIPS:  Ladies  and  gentlemen,  we  have  with  us 
one  of  the  prominent  members  from  the  state  of  Colorado,  Mr.  W.  G. 
Swart,  and  will  be  glad  to  hear  from  him  with  a  statement  of  his  views 
on  the  promotion  of  the  usefulness  of  the  American  Mining  Congress. 

(The  President  in  the  chair.) 

MR.  SWART,  of  Colorado:  Mr.  Chairman  and  Fellow  Members:  I 
have  been  asked  to  say  just  a  few  words  further  with  regard  to  the  atti- 
tude of  the  American  Mining  Congress  toward  legislative  affairs.  Like 
the  Secretary,  and,  I  presume,  also  the  President,  I  have  had  some  little 
experience  with  that  matter  in  the  state  of  Colorado  in  the  last  few 
years.  We  all  seem  to  have  our  troubles  in  various  states  with  our  tax- 
ation laws  and  our  compensation  laws  and  various  other  measures 
which  need  not  be  gone  into  in  detail  here.  We  are  all  apparently  fight- 
ing the  same  fight.  It  differs  a  little  in  the  various  states,  but  it  is  the 
same  fight.  Now,  no  one  is  going  to  fight  this  battle  for  us;  we  have 
to  do  it  ourselves.  None  of  us  is  able  to  make  this  fight  single-handed, 
no  state  is  able  to  make  it  single-handed.  We  must  organize  and  stand 
shoulder  to  shoulder,  and  as  I  understand  the  American  Mining  Congress, 
that  is  its  fundamental  idea.  That  is  one  reason,  and  a  good,  strong 
reason,  a  real  reason,  why  the  American  Mining  Congress  ought  to  have 
the  support  of  every  man  in  any  way  interested  in  the  mining  business. 

A  little  while  ago  the  Secretary  said  that  in  a  good  many  of  the  states 
legislation  had  been  originated  by  irresponsible  or  vicious  people.  It 
seems  to  me  there  is  still  another  class,  the  ignorant  people— people  who 


AMERICAN     MINING     CONGRESS  119 

do  not  really  know  what  they  are  doing;  and  if  you  will  go  into  the 
state  legislatures  and  study  the  men  we  have  sent  there,  you  will  discover 
that  a  very,  very  large  portion  of  the  trouble  is  not  viciousness  but 
ignorance.  Now,  it  is  up  to  us  to  produce  the  education.  If  anyone 
knows  anything  about  this  mining  business  we  do.  We  are  miners.  Who 
is  going  to  educate  these  men  and  who  is  going  to  provide  this  informa- 
tion unless  we  do,  and  if  we  do  not,  who  is  to  blame?  Ourselves  alone! 

I  am  going  to  tell  you  a  little  thing  that  happened  in  Colorado  two 
or  three  years  ago.  The  governor  appointed  a  certain  man  trustee  of 
the  State  School  of  Mines.  This  man  was  not  at  all  fitted  for  the  po- 
sition, and  when  the  appointment  was  duly  announced  three  prominent 
mining  men  of  the  state  of  Colorado  took  it  upon  themselves  to  go  up 
and  protest  to  the  governor.  They  walked  in  and  said,  "Why,  Governor, 
we  are  simply  astounded  that  you  should  make  such  an  appointment  as 
this,  and  we  are  right  here  to  protest  against  it."  The  governor  whirled 
around  in  his  chair  and  said,  "Gentlemen,  that  is  far  enough.  Every 
man  of  you  knew  that  this  appointment  was  to  be  made,  and  every  man 
of  you  knew  that  I  had  to  make  it,  and  that  this  was  the  time  it  was  to 
be  made.  There  were  three  candidates  for  this  office;  no  one  spoke  a 
single  word  for  two  of  them,  and  I  have  here  only  two  letters  advocating 
the  appointment  of  this  other  man.  If  this  meant  anything  to  you,  why 
didn't  you  come  and  tell  me  what  you  wanted  and  what  I  ought  to  do? 
With  proper  advice  from  you  gentlemen  in  advance  I  would  have  been 
glad  to  appoint  any  man  had  you  shown  me  he  was  the  proper  one." 
Now,  that  is  the  idea.  How  do  you  expect  we  are  going  to  get  what  we 
are  entitled  to?  How  do  you  expect  the  men  at  the  head  of  the  gov- 
ernment will  know  what  we  want  unless  we  tell  them?  And  as  I  con- 
ceive the  American  Mining  Congress,  its  duties,  its  opportunities  are 
right  along  this  line,  and  the  responsibility  for  action  is  ours. 

And  there  is  one  thing  more.  I  can't  say  that  I  know  exactly  how 
to  present  it,  but  it  is  a  general  proposition.  It  is  not  confined  to  mining 
men.  You  look  back  over  political  history  in  this  country  and  you  will 
find  a  large  part  of  the  criticism  made  of  our  methods  of  legislation  has 
had  to  do  with  the  lobbying  system.  What  was  done  was  often  done 
under  cover  and  in  an  under-handed  way.  But  the  railroad  people  have 
had  to  come  out  into  the  open.  It  was  forced  upon  them.  The  railroad 
lobby  is  practically  a  thing  of  the  past.  It  may  still  exist,  and  I  presume 
it  does  exist,  in  spots,  but  taken  by  and  large,  the  railroad  lobby  is  a 
thing  of  the  past;  and  in  the  future  you  are  going  to  see  the  railroads 
coming  squarely  out  in  front  of  the  public  with  whatever  they  have  to 
offer — with  their  complaints,  with  their  troubles,  with  their  requests  and 
with  their  demands,  and  they  have  got  to  play  in  the  open.  And  so, 
gentlemen,  have  we  got  to  play  in  the  open.  I  think  it  is  beyond  any 
question  that  the  time  has  come  when  the  mining  men  with  a  just  cause 
must  stand  up  firmly  and  in  public  view  and  tell  the  people  plainly  what 
the  truth  is,  back  it  up  with  the  reasons  and  demand  their  rights;  and 
I  believe,  gentlemen,  that  the  American  Mining  Congress  has  a  place, 
it  has  a  position,  it  has  a  niche  to  fill,  and  that  it  can  better  do  this 
work  than  any  organization  that  is  in  existence  today.  For  one,  I  am 
prepared  to  support  it  so  far  as  I  can,  myself,  and  for  the  people  I 
represent,  and  I  hope  you  all  feel  the  same.  If  you  don't,  get  posted.  I 
thank  you.  (Applause.) 

THE  PRESIDENT:  Ladies  and  Gentlemen:  There  is  a  delegate 
present  this  evening  who  made  such  an  entertaining  address  this  after- 
noon that  I  feel  sure  we  will  want  to  hear  another  one  from  him.  I  now 
call  upon  Dr.  William  B.  Phillips  of  Austin,  Texas. 

MR.  PHILLIPS:  A  good  many  years  ago  Mr.  Knott  represented  a 
district  in  Congress  from  the  state  of  Kentucky.  He  made  a  famous 
speech  about  certain  improvements  which  the  government  was  to  under- 


120  OFFICIAL     PROCEEDINGS 

take  at  Duluth  and  spoke  of  Duluth  as  the  queen  city  of  the  unsalted 
sea,  and  went  along  in  a  very  humorous  and  effective  vein.  It  is  re- 
ported that  he  said  he  would  have  given  a  thousand  dollars  if  he  had 
never  made  a  humorous  speech  in  Congress,  as  nobody  afterwards  be- 
lieved that  he  could  be  in  earnest. 

The  moral  of  this  story  lies  in  the  application  of  it.  It  has  become 
my  unfortunate  duty  to  speak  of  the  financial  end  of  the  undertakings 
that  lie  before  this  American  Mining  Congress.  Many  years  ago,  when 
I  was  some  years  younger  than  I  am  now,  I  was  a  deacon  in  the  Presby- 
terian Church.  (Laughter.)  No  one  need  believe  that  unless  he  wants 
to.  I  had  to  collect  money  for  the  sustenance  of  the  church  and  the  pay- 
ment of  the  pastor's  salary,  all  of  which  I  did  with  signal  success.  We 
want  about  four  million  dollars  out  of  the  United  States  government  for 
the  advancement  of  the  American  mining  industry,  and  I  propose  that 
we  get  it.  (Laughter  and  applause.)  I  want  to  read  to  you,  or  rather, 
recite  to  you,  some  very  pertinent  statistics  on  this  subject  prepared 
lay  the  director  of  the  Bureau  of  Mines  and  published  in  his  last  annual 
report.  Those  figures  were  adopted  by  Mr.  Kern  in  his  speech  before 
the  United  States  Senate  in  furtherance  of  some  of  the  plans  submitted 
for  the  support  and  maintenance  of  mining  experiment  stations  through- 
out the  country;  so  they  have  a  double  value,  having  first  been  prepared 
by  the  director  of  the  Bureau  and  then  used  by  Mr.  Kern. 

The  total  value  of  the  agricultural  products  of  this  country  is  about 
ten  billion  dollars. 

The  total  value  of  the  mining  products  may  be  taken  as  about  four 
billion  six  hundred  million. 

The  appropriations  for  agriculture  by  the  United  States  Congress 
amount  to  about  twenty-eight  million  dollars. 

The  appropriations  for  the  support  of  the  mining  industry,  including 
all  of  the  work  of  the  Geological  Survey  and  Bureau  of  Mines,  all  of  the 
work  that  is  undertaken  for  topographical  surveys,  surveys  for  water 
and  irrigation  which  fall  under  that  department  of  the  government — how 
much  do  you  suppose?  About  two  million  dollars.  Twenty-eight  million 
dollars  for  agriculture;  two  million  dollars  for  mining!  Whose  fault  is  it? 
I  think  it  is  the  fault  of  the  mining  men.  The  farmers  can  stand  to- 
gether, and  they  do.  They  present  a  united  front,  whether  they  call 
them  Populists  or  Grangers  of  Democrats.  (Laughter.)  There  is  very 
little  wavering  in  their  ranks,  and  what  they  want  they  generally  get. 
You  know  a  farmer  is  a  man  who  makes  his  money  in  the  country  and 
spends  it  in  town,  and  an  agriculturist  is  a  man  who  makes  his  money 
in  the  town  and  spends  it  in  the  country.  (Laughter.)  I  am  an  agri- 
culturist. I  once  owned  a  farm  in  North  Carolina  and  it  broke  me  every 
year  trying  to  keep  it  up,  but  I  can  distinctly  recall  that  the  members 
of  the  legislature  were  very  much  more  inclined  to  regard  me  with 
respect  as  long  as  I  owned  a  farm.  When  I  became  a  mining  man  they 
passed  me  by  on  the  other  side  of  the  street.  It  is,  I  think,  our  fault — 
and  I  speak  of  the  mining  men  collectively — that  the  United  States  gov- 
ernment regards  with  so  little  favor  any  requests  coming  from  the 
mining  industry  of  the  country.  If  we  had  from  the  general  government 
the  same  proportional  support  that  is  given  to  agriculture  we  would  have 
about  eleven  million,  dollars  a  year  spent  for  the  benefit  of  the  mining 
industry.  We  would  have  about  eleven  million  dollars  expended  for  the 
benefit  of  the  mining  industry,  as  against  twenty-eight  million  for  agri- 
culture, because  that  is  the  relative  proportion  of  the  value  of  those 
two  products,  agricultural  and  mineral,  instead  of  which,  for  all  pur- 
poses, we  have  less  than  two  million. 

If  you  will  pardon  me  for  a  minute,  I  am  going  to  read  a  little  item 
here  taken  from  Senator  Kern's  speech,  and  I  want  you  to  remember  it. 


AMERICAN     MINING     CONGRESS  121 

The  yearly  appropriation  by  the  general  government  for  agriculture. 
Three  separate  items.  From  direct  appropriation,  $2,500,000;  from  land 
grants,  $1,000,000;  from  the  Smith-Lever  bill,  which  I  believe  is  now 
pending,  $480,000  in  1915,  and  then  it  increases  automatically,  so  much 
each  year,  until  it  becomes  a  very  respectable  sum;  for  fifty-two  agri- 
cultural experiment  stations,  one  in  each  state,  $1,500,000;  for  general 
research  and  other  work  in  agriculture  and  mining — I  am  glad  they  put 
in  those  words  "and  mining"— .$22,000,000. 

That  "and  mining"  reminds  me  of  the  way  they  used  to  manage  in 
North  Carolina,  when  a  colored  man  and  a  white  man  went  into  partner- 
ship in  the  farming  business.  The  old  nigger  said  that  at  about  harvest 
time  the  white  man  would  take  out  a  little  old  pencil  and  figure  on  the 
back  of  an  envelope  and  he  would  say: 

Naught  is  a  naught,  and  a  figger  is  a  figger, 

All  for  the  white  man  and  none  for  the  nigger.     (Laughter.) 

I  think  that  is  the  way  our  appropriations  were  figured  out;  they 
get  twenty-eight  million  dollars  a  year  and  we  get  two.  Where  do  we 
get  off?  Now,  how  are  we  going  to  get  that  money?  I  do  not  doubt 
for  a  minute  that  we  shall  get  it.  You  never  get  anything  that  you 
don't  expect  to  get.  I  think  there  is  a  bill  now  pending  in  Congress 
for  the  establishment  of  fifteen  mine  experiment  stations  throughout  the 
United  States  and  an  appropriation  of  twenty-five  thousand  dollars  to 
each  one.  It  is  barely  possible,  I  think,  that  at  this  session  of  the 
Congress  more  than  three  of  those  stations  shall  be  established,  if  so 
many.  One,  I  suppose,  would  be  established  in  Arizona,  in  connection 
with  the  University;  the  others  established  throughout  the  country 
where  the  needs  seem  to  be  most  pressing.  It  is  up  to  the  mining  men 
of  the  country  to  secure  the  passage  of  that  bill.  If  we  do  not  pass  it 
nobody  else  will  give  it  the  least  attention.  If  you  people  believe  that 
Arizona  ought  to  have  one  of  those  mine  experiment  stations,  go  and 
get  it.  If  in  Texas  we  believe  we  ought  to  have  one,  why,  we  will  go 
and  get  it.  If  there  is  to  be  one  farther  north  of  here,  or  farther  east — 
you  cannot  go  much  farther  south — those  people  will  simply  have  to  go 
and  get  it. 

Now,  furthermore,  I  want  to  say  that  I  fully  indose  what  Mr.  Swart 
has  said.  I  always  agree  with  what  Mr.  Swart  has  said,  no  matter  if 
he  didn't  say  it.  (Laughter.)  All  this  work  must  be  done  perfectly 
above  board.  It  must  be  perfectly  understood  that  this  is  an  open  game 
from  one  end  to  the  other.  We  have  nothing  to  conceal;  we  have  every- 
thing to  lay  bare;  we  must  make  our  demands  perfectly  open  and  plain 
so  that  we  can  appeal  to  that  great  sense  of  fair  play  which  is  the  dis- 
tinguishing characteristic  of  nearly  every  American  I  have  ever  known 

I  think  one  reason  why  there  is  getting  to  be  somewhat  of  a  rever- 
sion of  popular  sentiment  in  regard  to  the  railroads  is  the  fact  that  the 
American  people  have  become  aroused  to  the  idea  that  the  railroads 
haven't  had  a  square  deal,  and  when  they  come  to  understand  that  the 
mining  inlustry  in  this  country  has  not  had  a  square  deal  the  American 
people,  if  I  understand  them  aright,  will  see  that  we  do  get  it.  We  are 
asking  for  no  more  than  our  just  proportion  of  government  help.  I 
wouldn't  take  one  cent  away  from  the  farmers;  I  wouldn't  take  one  cent 
away  from  the  twenty-eight  million  dollars  that  is  devoted  to  agriculture. 
It  needs  it  and  more.  But  we  need  it,  too.  We  need  it  in  proportion  as 
they  need  it,  and  if  we  do  not  go  and  get  it  I  think  they  will  get  it. 
(Laughter.) 

Now,  to  bring  the  matter  a  little  bit  nearer  home:  How  much  do 
you  good  people  in  Arizona  give  to  the  support  and  maintenance  of  the 
mining  business  in  your  state?  You  talk  about  the  great  mineral  prod- 
ucts of  Arizona,  and  they  are  very  large.  How  much  money  do  you 


122  OFFICIAL     PROCEEDINGS 

contribute  to  the  promotion  of  the  interests  of  the  mining  industry  in 
your  state?  Why,  back  East — and  I  do  not  live  so  very  far  back  East — 
we  do  not  regard  Arizona  as  an  agricultural  state;  we  think  of  it  as  a 
mining  state;  and  yet  I  am  told  you  give  four  times  as  much  to  the 
support  of  agriculture  as  to  the  support  of  mining.  Now,  how  can  you 
expect  the  general  government  and  those  interested  in  the  development 
of  the  mining  industry  of  the  country,  to  do  any  better  than  you  are 
doing  yourselves?  We  do  not  regard  Arizona  back  in  our  country — 
and  I  have  lived  much  farther  east  than  I  do  now — as  anything  but  a 
great  mining  state,  and  yet  I  am  told  that  you  do  not  do  very  much  for 
the  maintenance  of  the  mining  schools  and  in  aid  of  scientific  research 
here  in  your  own  state.  If  I  am  wrong  I  will  be  glad  to  be  corrected, 
just  as  glad  as  the  old  Dutchman  was  who  took  dinner  with  us.  He  was 
bragging  about  his  memory.  He  said,  "Mr.  Phillips,  I  have  an  awful 
good  memory.  You  have  no  idea  how  good  a  memory  I  have.  I  can't 
remember  a  single  thing  that  I  have  ever  forgotten."  (Laughter.)  If 
I  have  forgotten  anything  I  will  be  glad  to  have  you  call  it  to  my  at- 
tention. 

Now,  I  will  not  speak  any  longer  or  tax  your  patience.  We  must 
have  this  support  from  the  general  government,  and  we  must  have  it 
now,  and  if  we  do  not  get  it  ourselves  nobody  will  hand  it  to  us  on  a 
silver  platter.  Are  we  prepared  to  go  open-handed  and  open-hearted  into 
this  struggle?  If  the  American  Mining  Congress  is  to  stand  for  anything 
in  this  part  of  the  country  it  is  for  government  aid  in  undertakings  that 
we  cannot  undertake  for  ourselves. 

I  thank  you  very  much.      (Applause.) 

THE  PRESIDENT:  We  will  be  very  glad  to  hear  from  any  one 
else  who  has  anything  to  say  on  the  subject  of  the  betterment  of  the 
mining  interests  of  the  country.  We  do  not  want  to  close  now  because 
Dr.  Phillips  has  warmed  up  the  audience,  and  let  us  keep  the  iron  going 
while  it  is  hot.  Mr.  O'Brien,  you  are  a  Western  man  and  a  coal  man. 
Tell  us  what  you  have  done  and  what  you  are  going  to  do. 

MR.  O'BRIEN:  I  don't  know  that  I  have  anything  to  say.  I  am 
perfectly  willing  to  accept  Professor  Phillips'  apologies.  (Laughter.) 

MR.  WOLCOTT:  Mr.  President  and  Members:  The  question,  as  I 
understand  it,  tonight  is  what  can  we  do  to  better  the  condition  of  min- 
ing, and  judging  by  the  enthusiastic  manner  in  which  the  delegates  here 
rise  to  their  feet  to  offer  suggestions  at  the  present  time,  I  am  inclined, 
or  would  be  inclined,  to  believe  that  mining  was  getting  all  that  was 
coming  to  it  if  I  didn't  know  better.  I  do  not  think  there  is  a  man  within 
the  hearing  of  my  voice  who  believes  that  mining  is  receiving  the  atten- 
tion that  it  should  receive,  that  it  is  receiving  the  consideration  that  it 
should  have.  I  do  not  believe  there  is  a  man  here  that  believes  that  in 
any  of  the  Western  states  where  mining  is  being  done  that  enough  min- 
ing is  being  done  or  that  the  proper  kind  of  mining  is  being  done,  or, 
what  is  more  to  the  point,  that  the  mining  fraternity  is  getting  anything 
like  a  square  deal  in  its  mining  operations.  I  do  not  think  anybody 
believes  that  we  can  get  what  we  are  after  single-handed.  We  have 
been  trying  individually  for  years  as  miners  and  as  mining  corporations 
to  get  that  square  deal  from  the  federal  government,  from  the  state  gov- 
ernments, from  those  who  have  anything  to  do  with  the  mining  industry, 
and  we  have  failed.  Up  to  four  years  ago  the  mining  industry  was  hardly 
represented  except  through  the  Geological  Survey,  which  certainly  was 
not  a  mining  bureau,  and  yet  for  twenty-five  years  or  more  miners  were 
trying  to  have  a  bureau  or  department  of  mines  established.  They  were 
trying  individually.  They  went  before  congress  and  before  the  com- 
mittees and  asked  that  such  a  bureau  be  established,  and  they  got  turned 
down  and  got  nothing  for  it.  Then  it  was  taken  up  by  the  only  organ- 


AMERICAN     MINING     CONGRESS  123 

ization  which  had  mining  at  heart  and  was  doing  anything  for  mining, 
the  American  Mining  Congress,  and  within  four  years  from  that  time 
the  Bureau  of  Mines  was  established.  We  cannot  do  anything  individ- 
ually; we  can  accomplish  things  only  as  an  organization.  Here  in  Ari- 
zona you  have  had  some  laws  enacted  which  have  been  mentioned  be- 
fore in  this  convention,  which,  if  applied,  will  probably  close  the  greater 
part  of  the  mines  of  this  state.  There  are  two  such  laws  in  particular, 
one  that  forbids  a  mining  company  to  employ  more  than  twenty  per  cent 
of  any  class  of  people  that  are  not  qualified  electors;  another  law  that 
forbids  the  mining  men  to  ask  the  applicant  for  a  position  or  for  a  job 
if  he  an  American  citizen.  Now,  that  is  practically  the  way  the  anti- 
blacklist  and  the  eighty  per  cent  law  work  together.  And  what  are  you 
going  to  do?  Are  you  going  to  close  your  mines  or  are  you  going  to 
commit  a  felony?  And  yet  mining  men  allowed  those  laws  to  pass. 
Why?  Because  they  were  not  organized.  If  they  had  been  organized 
these  laws  would  not  have  passed. 

Now,  I  want  to  tell  you  some  things  that  can  be  done  by  a  state  or- 
ganization. I  want  to  cite  the  case  of  Colorado  and  its  tax  commission, 
or  the  Colorado  tax  law.  Two  years  ago  there  was  introduced  before 
the  legislature  of  Colorado  a  law  which,  in  many  ways,  was  arbitrary, 
which  allowed  the  assessor  a  latitude  that  no  assessor  should  be  al- 
lowed, and  which  in  many  ways  was  unfair  to  the  mining  industry.  As 
secretary  at  that  time  of  the  Colorado  Chapter  I  wrote  a  letter  analyzing, 
so  far  as  I  could,  the  effect  this  bill  would  have  on  the  mining  industry, 
and  I  sent  it  to  the  various  mining  men  of  the  state.  I  got  a  few  an- 
swers. Most  of  them  didn't  pay  any  attention  to  it  at  all.  The  answers 
that  I  got  said,  "It  is  so  ridiculous  it  cannot  pass."  "No  legislature  that 
has  the  sense  of  a  gray  cat  would  ever  pass  such  a  law."  However,  I 
could  do  nothing  individually.  I  wasn't  authorized  by  the  Chapter  to  do 
anything  further  than  I  had  done,  and  the  consequence  was  that  law 
passed.  Now,  that  was  bad  enough  as  it  stood,  but  the  assessment  which 
v;as  levied  in  one  district  was  contested  in  the  courts  by  the  mine 
owners  and  the  Supreme  Court  handed  down  a  decision  something  like 
this — that  the  assessment  should  be  levied  on  the  entire  value  of  the 
metal  contents  of  the  ore,  at  New  York  quotations,  irrespective  of 
whether  it  was  paid  for  at  the  smelter  or  whether  it  was  penalized  or 
thrown  out  as  waste  matter.  (Laughter.) 

Well,  a  good  many  of  the  mining  companies  and  some  individuals 
and  one  or  two  of  the  smaller  organizations  took  it  up  before  the 
Supreme  Court  and  asked  for  a  re-hearing.  They  were  not  granted  a 
re-hearing  at  that  time.  Then  the  Colorado  Chapter  of  the  American 
Mining  Congress  met,  took  up  the  same  question,  went  before  the  Su- 
preme Court,  asked  for  a  re-hearing,  and  was  granted  a  re-hearing,  and 
we  had,  I  think,  ten  days  in  which  to  prepare  our  brief  and  appear  be- 
fore the  court,  which  we  did,  and  within  ninety  days  we  had  secured  a 
reversal  of  that  decision;  we  secured  more  than  we  had  asked  for,  be- 
cause the  Supreme  Court  decided  that  the  charge  for  extraction  and 
transporation  should  also  be  deducted  from  the  ore  as  well  as  the  metals 
not  paid  for.  Now,  that  was  only  one  effort.  We  have  done  many  other 
things  in  that  state,  and  yet  our  organization  is  not  nearly  so  strong  as 
it  should  be.  Now,  miners  of  Arizona,  is  it  not  about  time  that  you  get 
together  in  an  organization  that  can  handle  these  questions,  or  are  you 
going  to  stand  back  and  try  individaully  to  do  what  you  cannot  do'  as 
an  individual  and  have  the  legislature,  the  tax  assessors  or  any  power 
that  be — I  am  not  throwing  it  at  my  friends  the  tax  commissioners  or 
assessors  in  the  back  part  of  the  hall,  but  the  tax  commission  has  to 
raise  the  money  to  run  this  state.  You  who  own  the  mines  look,  to  them, 
like  ready  money.  They  can  tax  you,  and  make  themselves  believe  they 
are  doing  the  right  thing.  Just  so  long  as  you  are  working  as  individ- 
uals, just  so  long  as  you  are  not  organized,  you  are  going  to  get  this  kind 


124  OFFICIAL     PROCEEDINGS 

of  treatment.     Now,  isn't  it  about  time  to  get  together  and  organize  to 
look  after  your  own  interests? 
I  thank  you.     (Applause.) 

MR.  CHALMERS:  Mr.  President,  I  would  like  to  say  a  word  regard- 
ing raising  capital  for  mining.  Some  years  ago  I  went  up  into  Alaska — in 
1898.  I  spent  three  or  four  years  there,  and  while  there  I  was  inter- 
ested in  mining.  I  found  companies  there  which  had  flooded  some  of 
the  states  with  what  they  called  mining  certificates.  Some  of  these 
companies  spent  very  little  of  the  money  for  mining  purposes.  Of  course, 
not  having  spent  any  money,  or  very  little,  those  that  bought  stock  didn't 
receive  any  dividends.  In  1912,  I  believe,  they  passed  in  this  state,  what 
is  called  the  blue-sky  law,  and  we  have  a  commission,  and  it  has  taken 
some  of  us  promoters  out  of  that  class  of  people  who  take  people's 
money  and  put  it  in  their  pockets  and  don't  put  it  into  mines.  A  few 
years  ago,  and  more  recently,  nearly  every  magazine  I  would  pick  up 
was  advising  people,  bankers  especially,  people  with  money,  farmers, 
everyone,  not  to  put  a  cent  in  mining;  that  they  did  not  consider  mining 
a  safe  investment.  Suppose  we  want  to  raise  capital  to  help  the  mining 
industry — I  have  been  trying  to  raise  a  little  myself,  and  that  is  how 
I  come  to  know  a  little  about  it.  Nearly  every  friend  I  approached 
seemed  to  think  I  was  a  thief  or  something  about  as  bad.  I  have  had 
a  good  many  temptations  to  be  dishonest,  and  I  try  to  be  honest.  I  pay 
my  bills,  and  I  am  willing  to  go  in  debt  if  people  will  trust  me.  It 
would  seem  to  me  the  best  way  for  us  to  raise  money  for  mining  would 
be  for  those  who  are  in  a  position  to  do  so  to  try  to  educate  people  who 
have  been  led  to  think  that  all  promoters  are  thieves.  Since  these  blue- 
sky  laws  have  been  passed,  these  commissions  look  into  these  things, 
and  unless  a  prospect  is  sufficiently  good  it  is  impossible  for  any  one 
to  sell  stock.  These  commissions,  if  I  undestand  it  right,  are  going  to 
look  into  the  matter  from  now  on  and  see  that  a  fair  amount  of  that 
money  is  invested  in  the  mines,  and  invested  right,  giving  the  people  a 
chance  to  get  their  money  as  they  never  have  before.  I  think  if  the 
people  could  be  educated  to  the  fact  that  mining  is  becoming  more  hon- 
orable than  it  has  been  in  the  past  the  majority  of  the  people,  or  a  great 
many  of  them,  would  be  only  too  glad  to  invest  with  those  who  are  try- 
ing to  open  up  the  mines. 

I.  thank  you.     (Applause.) 

A  DELEGATE:  Mr.  President,  I  am  a  miner,  and  I  have  some  min- 
ing claims  loqated  ten  miles  from  Wilcox,  Arizona,  in  the  foothills  of 
the  Graham  mountains.  I  got  through  doing  some  assessment  work  out 
on  the  claims,  came  to  Bisbee,  Arizona,  looking  for  work,  and  I  was 
referred  to  the  two  laws  put  through  in  the  state  of  Arizona,  that  you 
men  say  are  no  good — the  eighty  per  cent  law  and  the  anti-blacklist 
law.  I  went  to  the  Copper  Queen  employment  office  to  get  a  job.  I 
received  the  job.  I  went  before  the  doctor,  and  the  only  thing  he  could 
find  wrong  with  me  was  that  I  had  a  little  fever.  I  couldn't  get  any 
work.  I  don't  believe  in  competing  with  the  foreign  element  in  this 
country.  I  can't  go  into  the  Bisbee  camp  and  live  on  50  cents  a  day  as 
those  people  can.  That  is  my  opinion  in  regard  to  two  of  the  finest  laws 
ever  passed  in  the  state  of  Arizona.  Thank  you.  The  only  thing,  Mr. 
Chairman,  that  you  educated  men — you  men  are  educated  and  know 
better,  but  you  simply  blindfold  the  working  class  of  people  because  you 
haven't  got  the  backbone  to  stay  by  what  is  right. 

MR.  SHERMAN:  Mr.  President,  I  think  the  last  speaker  is  mis- 
taken in  the  object  of  the  physical  examination.  A  physical  examination 
was  suggested  for  a  very  just  purpose,  and  I  believe  it  is  serving  that 
purpose.  There  are  certain  men  who  ask  for  employment  in  the  mines 
who  are  not  fitted  to  work  underground.  They  are  not  fitted  to  work 


AMERICAN     MINING     CONGRESS  125 

underground  not  only  for  their  own  sake  but  for  the  sake  of  the  men 
they  are  working  with.  There  are  two  or  three  things  which  would 
bar  a  man  from  such  work.  One  of  them  is  tuberculosis;  another  is 
heart  disease.  There  are  other  things  in  less  degree.  One  of  the  indi- 
cations of  tuberculosis  is  the  temperature.  I  think  every  doctor  will 
bear  me  out  in  that.  I  think  the  last  speaker,  if  he  had  returned  a  few 
days  later  with  no  temperature  would  have  had  no  difficulty  in  being 
passed  and  getting  work.  I  think  no  one  can  object  to  the  barring  out 
of  a  man  with  tuberculosis  from  work  underground.  It  can  do  him  no 
good.  He  has  no  business  underground,  for  himself,  and  he  is  injuring 
every  man  that  he  is  associated  with. 

A  DELEGATE:  Mr.  Chairman,  in  regard  to  the  question  the  gentle- 
man brought  up  there,  I  don't  see  why  they  don't  pass  a  law  that  they 
would  examine  a  man  when  he  gets  through  working  in  one  of  those  hot 
boxes,  as  I  call  them.  That  is  the  time  to  examine  a  man  that  gets  all 
your  diseases  this  man  claims.  That  is  the  time  to  examine  them — 
when  they  come  out  of  these  hot  places. 

THE  PRESIDENT:  I  would  like  to  correct  an  impression  of  the 
last  speaker  in  connection  with  his  reference  to  the  educated  man.  For 
my  part,  I  am  a  mining  man  from  the  pick.  I  worked  in  the  mines 
myself  in  Germany,  and  we  were  compelled  to  undergo  a  physical 
examination,  because  we  had  the  workmen's  compensation  acts,  which 
carried  with  them  pensions,  and  our  employers  felt  that  they  wanted 
to  be  very  careful  in  the  employment  of  their  men,  therefore  we  had  to 
undergo  a  much  more  rigid  examination  than  those  required  by  life 
insurance  companies  in  this  country,  and,  it  had  a  very  beneficial  effect. 
It  gave  us  a  better  class  of  miners  all  the  way  through  and  kept  many 
men  from  wasting  their  lives  had  they  been  permitted  to  go  underground. 
So  I  have  had  experience  as  a  practical  miner,  and  I  will  say  that  our 
wages  were  nothing  like  yours  are  here,  and  the  work  was  much  harder 
and  more  trying,  and  we  found  that  a  physical  examination  was  of  the 
utmost  importance,  and  it  was  conducted  with  every  man  that  was  ad- 
mitted to  a  mine  before  he  would  be  allowed  to  go  inside. 

MR.  WOLCOTT :  Mr.  President,  I  would,  like  to  correct  the  gentle- 
man in  regard  to  his  understanding  of  my  remarks  pertaining  to  these 
two  laws.  I  did  not  question  whether  the  laws  were  good  or  bad.  What 
I  said  was  that  there  had  been  two  freak  laws  passed  which  conflict  with 
each  other,  one  nullifying  the  other,  if  you  try  to  live  up  to  them  as  they 
appear  upon  the  statute  books.  That  was  my  sole  contention. 

THE  PRESIDENT :  I  would  like  to  make  just  one  more  remark,  and 
that  is,  that  all  great  movements  usually  come  from  the  east  to  the  west. 
Women's  fashions  that  originate  in  Paris  find  their  way  to  Chicago  and 
land  in  Phoenix — as  I  discovered  last  night.  (Laughter.)  I  think  the 
legislative  movements  work  very  much  in  the  same  manner,  and  I  have 
had  experience  in  the  last  fifteen  years  in  one  of  the  highly  organized 
states,  the  state  of  Illinois.  It  has  been  our  experience  that  we  have 
great  lessons  to  learn  from  our  employes  who,  by  organized  efforts, 
obtain  concessions  that  we  would  not  be  able  to  get,  and  finally  we 
agreed  in  our  wage  agreements  that  our  employes  would  not  introduce 
any  bills  in  any  legislative  house  that  had  not  been  discussed  with  us. 
That  forms  a  part  of  our  wage  agreements  now,  and  we  found  it  abso- 
lutely necessary.  You  people  out  here  haven't  had  to  deal  so  long  as 
we  have  with  labor  unions,  but  I  can  tell  you  that  we  have  learned  some 
valuable  lessons  from  the  acts  of  our  employes.  It  has  been  the  tendency 
of  coal  operators  to  content  themselves  with  the  defense  of  their  inter- 
ests against  measures  introduced  rather  than  to  form  and  introduce 
aggressive  legislation.  We  simply  rested  on  our  oars  and  endeavored  to 
defend  ourselves  against  such  bills  as  were  proposed;  but  our  aim  and 


126  OFFICIAL     PROCEEDINGS 

effort  now  is  to  do  the  very  opposite — to  introduce  legislative  measures 
and  thereby  stop  the  other  side  from  being  too  aggressive,  and  that,  in 
my  opinion,  should  be  the  first  effort  of  the  American  Mining  Congress, 
to  draft  bills  which  will  meet  your  needs,  and  introduce  them,  and  not 
wait  to  simply  fight  the  other  fellow  off,  but  to  attack  him,  to  pursue 
very  much  the  tactics  that  the  great  German  Emperor  has  pursued  of 
late,  and  I  very  much  hope  that  before  we  leave  here  we  will  adopt 
ways  and  means  to  bring  that  about. 

We  will  be  glad  to  hear  from  others.  We  still  have  a  few  minutes 
before  adjournment. 

SECRETARY  CALLBREATH:  Mr.  President,  this  being  a  meeting 
of  members,  and  a  little  different  from  our  regular  convention  sessions, 
I  move  that  the  members  meeting  do  now  adjourn  to  meet  at  2  o'clock 
tomorrow  afternoon.  This  will  give  the  Nominating  Committee  time  to 
report,  the  Convention,  as  such,  reconvening  at  9:30  in  the  morning. 

(Motion  seconded  and  carried.) 

Meeting  adjourned. 


ADJOURNED    MEETING    OF    MEMBERS. 

December  9,   1914. 

2:30  P.  M. 

CHAIRMAN  DAY:  Gentlemen,  we  will  be  obliged  to  pass  the  pro- 
gram for  a  few1  moments  and  go  into  session  as  a  meeting  of  the  mem- 
bers of  the  American  Mining  Congress.  Visitors  will  please  remain  in 
their  seats.  It  is  only  a  formal  matter  and  the  report  of  the  Committee 
on  Nominations  is  now  in  order.  Is  the  chairman  of  that  committee 
ready  to  report? 

MR.  W.  G.  SWART:  Mr.  Chairman,  your  Nominating  Committee 
beg  to  report  the  following  nominations  for  directors  of  the  American 
Mining  Congress  for  a  term  of  three  years:  Messrs.  Samuel  A.  Taylor, 
Carl  Scholz,  Charles  S.  Keith,  L.  A.  Friedman  and  Walter  Douglas;  for 
director  to  serve  for  term  of  one  year,  Falcon  Joslin. 

I  move  the  adoption  of  the  report. 

Motion  seconded. 

THE  CHAIRMAN:  It  is  regularly  moved  and  seconded  that  Messrs. 
Samuel  A.  Taylor,  Carl  Scholz,  Charles  S.  Keith,  L.  A.  Friedman  and 
Walter  Douglas  be  elected  to  serve  for  a  term  of  three  years,  and  that 
Falcon  Joslin  be  elected  to  serve  as  director  for  one  year.  Are  you  ready 
for  the  question? 

SECRETARY  CALLBREATH:  The  by-laws  provide  that  the  elec- 
tion be  by  ballot,  so  that  if  there  is  no  objection  an  instruction  to  the 
Secretary  to  cast  the  unanimous  vote  by  ballot  would  be  in  order. 

CHAIRMAN  DAY:  Gentlemen,  you  have  heard  the  statement  of  the 
Secretary.  What  is  your  pleasure?  If  there  is  no  objection  to  the  names 
proposed  by  the  Nominating  Committee,  a  resolution  as  suggested  by  the 
Secretary  will  be  in  order. 

MR.  SCHOLZ:  There  is  an  objection,  Mr.  Chairman.  I  have  been 
a  director  for  four  or  five  years,  and  I  feel  that  I  have  done  my  duty 
by  this  movement,  and  I  would  be  very  glad  to  have  some  other  man 
selected  to  take  my  place.  There  are  men  who  are  better  able  to  work 
for  this  cause  than  I,  and  I  candidly  believe  it  would  be  for  the  best 
interests  of  the  Mining  Congress  to  put  somebody  else  in  my  place. 


AMERICAN     MINING     CONGRESS  127 

CHAIRMAN  DAY:  I  think,  Mr.  Scholz,  the  Congress  appreciates 
your  position,  but  at  the  same  time  good  men  are  scarce.  The  showing 
you  have  made  in  the  administration  of  the  affairs  of  the  American 
Mining  Congress  is  such  that  we  cannot  afford  to  lose  you.  That  is 
my  judgment,  and  I  am  sure  the  other  members  agree  with  me.  As  a 
representative  of  the  great  coal  mining  industry  we  certainly  need  a  man 
of  your  caliber  on  the  board.  I  am  glad  there  is  no  move  to  accept  your 
declination,  and  the  chair  declines  to  entertain  it.  (Great  applause.) 

A  motion  to  authorize  the  Secretary  to  cast  the  unanimous  ballot 
of  the  members  present  in  favor  of  these  nominations  is  now  in  order. 

MR.  CLARK:  Mr.  President,  I  move  that  the  Secretary  be  in- 
structed to  cast  the  unanimous  vote  of  the  members  present  for  the 
nominations  as  submitted  by  the  committee. 

(Motion  seconded  and  carried  unanimously.) 

CHAIRMAN  DAY:     The  Secretary  will  cast  the  ballot  accordingly. 

SECRETARY  CALLBREATH:  Mr.  President,  in  accordance  with 
your  instructions  I  hereby  cast  the  unanimous  vote  of  the  members  of 
the  American  Mining  Congress  for  the  election  of  Mr.  Falcon  Joslin  to 
serve  on  the  Board  of  Directors  of  the  American  Mining  Congress  for 
one  year  and  until  his  successor  is  elected  and  qualified,  and  for  Messrs. 
Samuel  A.  Taylor,  Carl  Scholz,  Charles  S.  Keith,  Walter  Douglas  and 
L.  A.  Friedman  to  serve  as  directors  for  the  term  of  three  years  and 
until  their  successors  are  duly  elected  and  qualified. 

CHAIRMAN  DAY:  The  votes  have  been  cast  by  the  Secretary  ac- 
cording to  the  direction  of  the  Congress,  and  I  now  declare  the  gentle- 
men named  have  been  duly  and  regularly  elected  directors  of  the 
American  Mining  Congress. 

Members  meeting  adjourned. 


The  President's  Annual  Address 

BY   CARL   SCHOLZ, 
CHICAGO,    ILL. 


The  aim  and  purpose  of  The  American  Mining  Congress  have 
been  placed  before  the  membership  and  mining  interests  so  often 
in  recent  years  that  it  becomes  unnecessary  to  reiterate  them  now. 
There  is  no  doubt  that  the  need  for  this  organization  has  become 
greater,  that  its  efforts  are  more  appreciated,  and  that  it  occupies 
a  stronger  position  now  than  at  any  previous  time.  That  its  good 
work  is  valued  by  others  than  the  metal  miners  of  the  West  is  evi- 
denced by  the  active  interest  taken  in  its  work  by  the  coal  mine 
operators,  more  particularly  since  the  Chicago  meeting  of  1911.  It 
may  be  appropriate  at  this  time  to  state  that  the  coal  operators 
joined  The  American  Mining  Congress  because  they  felt  it  was 
the  best  organization  in  existence  to  carry  out  the  work  in  hand, 
having  an  established  standing  and  working  machinery.  Efforts 
to  start  co-operative  work  among  the  coal  operators  had  failed  and 
The  American  Mining  Congress  was  considered  the  best  organiza- 
tion which  could  be  helpful  to  the  coal  mine  operators,  as  it  had 
been  in  the  metal  mining  business.  It  has  been  hinted  that'  some 
of  the  metal  miners  felt  the  coal  people  were  trying  to  monopolize 
the  Mining  Congress,  but  let  me  assure  you  now  that  such  is  not 
the  case.  Mining  is  mining,  whether  the  product  be  coal  or  gold. 
Our  interests  are  identical  whether  the  mines  are  located  in  Arizona 
or  Pennsylvania.  The  chief  topic  of  this  address,  therefore,  is  to 
urge  co-operation  and  combined  efforts  toward  improvement  in  the 
mining  industry,  irrespective  of  the  location  of  the  mines  or  the 
character  of  their  product. 

I  will  not  burden  you  with  the  detailed  statements  of  what 
has  been  done  in  the  last  year.  The  reports  of  the  various  com- 
mittees and  of  the  Secretary  will  c6ver  these  subjects  fully.  There 
is  one  point  I  will  touch  upon  briefly  in  reference  to  our  financial 
situation.  As  you  will  see,  our  income  for  the  year  has  exceeded 
our  expenses  and  our  outstanding  debts  have  been  diminished — 
this  notwithstanding  the  increased  expenses  due  to  the  maintenance 


130  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

of  the  Washington  office  during  the  entire  year  on  account  of  the 
prolonged  session  of  Congress ;  also  that  arrangements  have  been 
completed  on  begin  on  January  1st  next  the  publication  of  a  month- 
ly bulletin,  which  will  serve  to  establish  closer  relations  between 
our  widely  scattered  membership  and  keep  the  more  inactive  mem- 
bers thoroughly  posted  on  the  work  in  hand. 

The  methods  of  modern  business  within  the  short  time  of  our 
experience  have  undergone  great  changes.  The  advance  from  the 
tallow  dip  to  the  tungsten  lamp  in  the  lighting  of  our  homes  may 
be  considered  a  fair  comparison.  In  the  first  half  of  the  past 
century  the  perplexing  question  of  big  business  had  not  made  its 
appearance.  When  owners  were  co-workers  there  was  little  need 
for  legislative  regulation  or  supervision.  Man  had  not  specialized 
upon  a  single  occupation  or  depended  solely  upon  it  for  his  liveli- 
hood. Trade  Unions  had  not  restricted  the  working  hours  or  out- 
put of  individuals.  The  relations  between  employers  and  employes 
w'ere  closer,  and  personal  equations  were  more  pronounced.  There 
was  little  need  for  contracts  and  intricate  agreements — a  man's 
word  was  his  bond.  I  do  not  intend  to  convey  the  impression  that 
modern  business  is  altogether  bad,  but  it  certainly  is  different,  and 
to  some  it  may  seem  better.  The  question  we  must  naturally  ask 
ourselves  is,  have  we  contributed  our  share  toward  the  solution  of 
the  great  problems  which  necessarily  follow  in  the  w'ake  of  tre- 
mendous development  such  as  this  country  has  undergone.  We 
have  a  different  people  to  deal  with  and  a  different  Government  to 
regulate  our  affairs ;  therefore  cannot  look  to  other  countries  for 
precedence  to  follow.  We  have  business  varying  from  the  smallest 
unit  of  the  single  prospector  to  the  largest  mining  corporations, 
with  many  grades  betw'een  these  two.  To  properly  protect  these 
great  varieties  of  investors  and  workers,  to  give  each  his  due 
share,  is  an  undertaking  of  the  greatest  importance. 

Mining  in  a  measure  is  the  administration  of  a  public  property 
insofar  as  it  is  an  estate  not  created  by  man  and  which  cannot  be 
replaced  once  it  is  removed  or  used.  Geographical  lines,  so  sharp- 
ly drawn  for  political  purposes,  must  be  lost  sight  of  in  mining, 
because  the  different  States  not  containing  any  mineral  resources 
are  dependent  upon  their  supply  from  the  more  favored  sections. 
Unlike  the  manufacturing  or  farming  industries,  the  sources  for 
mining  cannot  be  shifted,  and  yet  its  products  are  needed  every- 
where. The  enormous  coal  deposits  of  the  far  Northwest  are  of 


PRESIDENT'S    ANNUAL    ADDRESS  131 

little  interest  to  the  State  of  New  York  as  long  as  there  is  an  avail- 
able coal  supply  in  Pennsylvania,  but  New  York  is  concerned  in 
the  situation  of  its  present  coal  supply  because  if  it  is  exhausted 
sooner  by  waste,  that  section  of  the  country  will  have  to  depend 
upon  a  supply  located  elsewhere,  w'hich  will  be  more  costly  to 
obtain.  The  sections  with  small  or  no  mining  interests  are  usually 
large  consumers  of  mining  products,  and  the  metal  manufacturing 
sections  with  their  established  population  and  industries  depend 
upon  the  fuel  and  ores  of  the  mining  States  for  their  very  exist- 
ence. Mining,  therefore,  is  distinctly  an  interstate  business  and 
of  interstate  value.  Some  regulation  has  been  considered  in  this 
respect;  for  instance,  in  the  State  of  Oklahoma,  by  fixing  the 
minimum  price  at  which  gas  or  oil  from  its  wells  may  be  sold. 

I  am  not  competent  to  speak  authoritatively  on  the  great 
amount  of  mineral  resources  available,  but  I  have  often  endeavored 
to  reconcile  the  statements  published  by  the  United  States  Geologi- 
cal Survey  on  the  vast  amount  of  coal  available  in  certain  fields 
with  which  I  am  quite  familiar.  These  statements  refer  to  all  the 
coal  in  existence  without  distinguishing  as  to  the  cost  of  extrac- 
tion; in  fact,  all  Government  reports  are  silent  on  this  point,  and 
the  ordinary  reader  naturally  believes  that  the  billions  of  tons  of 
coal  available  can  be  produced  at  no  greater  cost  than  the  present 
supply.  This  cannot  be  true,  and  in  less  time  than  the  average 
man  believes  we  will  be  forced  to  recognize  the  fact  that  even  the 
largest  coal  fields  are  being  exhausted  very  rapidly  and  that  the 
remaining  coal  while  available  will  cost  many  times  over  the  present 
cost  of  production.  Even  within  the  limit  of  my  personal  experi- 
ence many  important  mining  centers  have  been  abandoned  or  gone 
back  in  their  production.  This  may  not  indicate  extraction  of  all 
the  available  coal,  but  certainly  no  more  coal  will  be  produced  in 
these  sections  at  the  present  prices,  and  undoubtedly  large  propor- 
tions of  the  abandoned  territories  are  lost  forever,  or  can  only  be 
recovered  at  a  greatly  increased,  or  perhaps  prohibitive  cost.  The 
average  life  of  a  coal  mine  in  this  country  is  rarely  in  excess  of 
twenty-five  years.  In  the  major  portion  of  our  coal  fields,  particu- 
larly the  interior  sections,  rarely  more  than  two  or  three  w'orkable 
veins  exist  in  the  same  territory,  frequently  only  one.  I  may  men- 
tion a  few  of  the  sections  more  generally  known  where  the  produc- 
tion has  diminished,  such  as  the  northern  coal  field  of  Illinois  and 
the  Hocking  Valley  field  of  Ohio.  In  the  Great  Kanawha  district 


132  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

of  West  Virginia  all  of  the  coal  along  the  river  has  been  worked 
out  or  abandoned  and  the  newer  mines  have  been  located  along 
creeks  and  tributaries  to  the  river.  If  these  mines  are  worked  out 
in  as  short  a  period  as  those  along  the  river  front,  it  will  not  take 
very  many  generations  to  exhaust  the  field.  In  Germany,  France 
and  South  Wales  where  from  ten  to  fifty  workable  veins  exist  in 
the  same  section  overlying  each  other,  it  is  merely  a  question  of 
increasing  the  depth  of  the  shaft  to  obtain  additional  areas.  Mines 
have  been  hoisting  coal  from  the  same  shaft  for  three  hundred 
years  in  the  vicinity  of  Liege.  If  similar  situations  exist  in  the 
metal  mining  industry,  then  we  betray  a  trust  placed  upon  us  by 
further  delay  in  exercising  the  obligation  which  we  assume  as 
managers  of  a  destructive  industry,  because  aside  from  the  proper 
treatment  of  our  workmen  and  consumers  the  chief  duty  of  the 
operator  is  to  avoid  waste,  which  is  an  irreparable  damage. 

We  can  only  speak  with  words  of  the  highest  praise  of  the 
work  accomplished  by  the  Bureau  of  Mines  during  its  short  exist- 
ence, and  at  the  same  time  decry  the  limited  support  which  this 
Bureau  receives  from  the  National  Government.  The  appropria- 
tions are  too  small  to  even  investigate  the  physical  features  of 
mining,  and  the  Bureau  is  not  in  a  position  to  be  of  any  assist- 
ance or  even  investigate  the  economic  sides  of  the  industry.  The 
only  statistics  collected  now  deal  with  the  mine  accidents,  and  the 
only  information  on  economics  is  collected  by  the  Census  Bureau 
every  ten  years  and  the  information  when  furnished  two  or  three 
years  later  is  of  practically  no  value  on  account  of  the  great  delay. 

The  people  of  the  United  States  now'  contribute  yearly  out  of 
the  Federal  treasury  twenty-eight  cents  per  capita  to  the  Depart- 
ment of  Agriculture  against  a  contribution  of  two  cents  per  capita 
for  the  advancement  of  mining  and  this  discrepancy  exists  in  spite 
of  the  following  facts  which  should  appeal  to  the  American  people : 

"That  in  mining  we  have  the  most  hazardous  of  our  great  in- 
dustries and  in  agriculture  the  safest. 

"That  our  mineral  resources,  once  exhausted,  cannot  be  re- 
placed and  we  therefore  should  use  this  supply  with  the  highest 
degree  of  intelligence  and  under  such  safeguards  as  keep  in  view 
the  w'elfare  of  our  future  generations. 

"That  in  point  of  production  every  miner  contributes  annually 
two  thousand  dollars  to  our  national  wealth  compared  to  a  con- 
tribution of  eight  hundred  dollars  from  every  farmer/' 


PRESIDENT'S    ANNUAL    ADDRESS  133 

The  appropriation  for  the  Bureau  of  Mines  is  less  than  one- 
half  that  for  the  Geological  Survey  and  much  less  than  that  for 
many  other  less  important  branches  of  our  public  service;  it  is 
entirey  insufficient  to  enable  this  Bureau  to  meet  even  the  humani- 
tarian demands  being  pressed  upon  it  in  behalf  of  safeguarding 
the  lives  of  the  more  than  two  million  men  associated  with  mining, 
metallurgical,  and  other  mineral  industries  of  the  country;  and  the 
Federal  Government  is  failing  in  its  duty  towards  this  great  in- 
dustry. 

I  am  sure  that  every  member  of  the  American  Mining  Con- 
gress will  agree  with  me  that  we  must  somehow'  impress  the  Con- 
gress of  the  United  States  with  the  imperative  need  of  enlarging 
the  appropriations  and  the  scope  of  the  work  of  the  Bureau  of 
Mines ;  I  am  also  sure  that  every  member  of  the  American  Mining 
Congress  will  agree  with  me  as  to  the  imperative  need  of  estab- 
lishing a  Federal  Department  of  Mines  which  will  have  within  its 
organization  several  bureaus,  each  investigating  different  phases  of 
the  mining  industry,  and  at  the  head  of  this  organization  a  Secre- 
tary of  Mining  who  will  be  a  member  of  the  President's  cabinet 
and  who  will  see  that  all  the  interests  and  the  needs  of  the  mining 
industry  are  properly  presented  to  the  President,  to  the  Congress 
of  the  United  States,  and  to  the  people  of  the  United  States. 

Other  branches  of  the  Government  do  a  great  deal  for  their 
constituents.  I  have  in  mind  the  crop  reports  which  are  collected 
by  the  Agricultural  Department  largely  by  telegraph  and  which  are 
furnished  very  frequently  to  the  farmers  and  dealers  in  farm 
products,  to  the  great  advantage  of  both.  Undoubtedly  the  mine 
owners  are  partly  responsible  for  not  having  insisted  upon  more 
co-operation  from  the  Government,  and,  perhaps,  w'e  have  a  lesson 
to  learn  from  the  mine  employes  in  obtaining  their  desires  from  the 
Government.  Through  the  various  ramifications  of  labor  organi- 
zations the  mine  workers  have  obtained  great  political  prestige  and 
have  made  good  use  of  it  from  their  viewpoint.  They  may  not 
have  always  acted  wisely,  but  they  have  obtained  much  they  have 
asked  for.  There  have  been  extended  strikes  in  the  metal  mining 
industry  and  some  are  in  existence  at  this  time.  The  great  coal 
strike  of  Colorado,  which  has  extended  over  a  period  of  five  years, 
is  being  waged  solely  to  obtain  recognition  of  the  Miners'  Union 
by  the  operators  of  that  State.  The  anti-trust  laws  passed  by  the 
last  Congress  are  generally  considered  a  great  victory  won  by  the 


134  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

laboring  classes.  For  years  we  have  heard  much  of  the  labor  op- 
pressing capitalist,  and  perhaps  there  were  isolated  cases  where 
the  acts  of  greedy  corporations  had  to  be  curbed,  but  there  is 
danger  of  going  too  far  in  this  direction,  and  sooner  or  later  it  will 
be  much  more  difficult  to  settle  the  labor  problem  than  has  been 
the  regulation  of  moneyed  trusts.  Labor  organizations  are  not  im- 
poverished and  do  not  ask  for  sympathy.  They  have  ample  funds, 
which  are  freely  spent  if  deemed  advisable  or  necessary  to  carry 
a  point.  Practically  two  per  cent  of  the  wages  of  the  organized 
coal  miners  is  contributed  to  the  maintenance  of  their  various 
organizations.  The  chief  difficulties  experienced  in  dealing  with 
these  organizations  are  not  so  much  with  their  leaders  as  with 
some  over-zealous  members  or  sub-officials.  Undoubtedly  these 
conditions  are  not  known  to  their  fullest  extent  by  our  people  or 
the  Government.  The  repeal  of  the  Full  Crew  Bill  under  the  ref- 
erendum law  of  Missouri  at  the  last  November  election  is  an  indi- 
cation that  the  people  are  interested  in  matters  of  avoiding  unneces- 
sary waste.  The  politicians  of  that  State  under  the  pressure  of 
railway  employes'  organizations  had  forced  the  passage  of  a  bill 
which  increased  the  operating  cost  of  the  railways  without  any 
benefit  to  their  employes  or  the  public.  It  was  a  question  of  a 
greater  number  of  people  having  pressed  their  case  before  their 
legislative  representatives  successfully,  but  when  the  attention  of 
the  people  was  called  to  the  defect  of  the  Bill  and  to  the  damage 
it  did,  it  was  promptly  recalled  and  set  aside  by  a  great  majority 
of  the  popular  vote.  The  coal  operators  of  Arkansas  and  Okla- 
homa were  not  so  fortunate  in  having  the  Mine  Run  Bills  of  these 
two  States  recalled,  and,  strange  as  it  may  seem,  in  the  latter  State 
the  greatest  support  w'hich  the  Bill  received  came  from  the  mem- 
bers of  the  Farmers'  Union,  whose  constituents  have  to  pay  the 
bulk  of  the  cost  because  they  are  the  buyers  of  that  grade  of  coal 
which  is  mainly  affected  by  this  damaging  legislation.  Perhaps 
the  Farmers'  Union  wished  to  help  the  Miners'  Union  because 
both  were  Unions  and  therefore  the  natural  enemy  of  capital.  Were 
it  not  a  most  serious  matter,  we  might  enjoy  the  ridiculous  view 
of  this  attitude. 

Congress  convenes  at  Washington  today,  and  there  is  neces- 
sity for  aggressive  and  constructive  legislation.  Mine  operators 
have  been  contenting  themselves  more  or  less  with  defensive  meas- 
ures, but  I  wish  to  urge  not  only  for  the  best  and  strongest  repre- 


PRESIDENT'S    ANNUAL    ADDRESS  135 

sentation  at  Washington  and  at  the  various  State  Capitols  but  also 
for  the  introduction  of  measures  deemed  necessary  to  the  best 
interests  of  mining.  At  this  occasion  I  want  to  make  clear  the 
oft-misunderstood  purpose  of  the  maintenance  of  the  Washington 
office  by  The  American  Mining  Congress,  some  members  having 
expressed  themselves  as  not  being  in  favor  of  maintaining  a  lobby, 
feeling  that  it  was  degrading  to  the  Congress  and  not  worthy  of 
the  industry.  This  attitude  and  misconception  must  be  corrected. 
Our  representation  at  Washington  is  not  for  the  purpose  of  unduly 
influencing  Congress  in  our  favor  or  obtaining  concessions  by  un- 
fair meains.  It  is  there  for  the  purpose  of  aiding  our  law  makers 
in  the  protection  of  the  industry  and  advising  them  of  our  needs. 
With  all  due  deference  to  the  make-up  of  our  State  and  National 
legislative  bodies,  it  is  not  reasonable  to  expect  of  them  a  thorough 
knowledge  of  all  affairs  of  this  great  country  and  the  needs  of  the 
great  multiplicity  of  interests  and  industries  therein.  It  is  not  only 
a  necessity  but  a  duty  of  each  industry  to  have  at  convenient  reach 
representatives  who  may  inform  and  consult  with  Congressmen  on 
matters  pertaining  to  their  respective  lines  of  business.  Every  day 
new  problems  arise,  regarding  which  the  Congressman  removed 
from  his  home  conditions  cannot  be  kept  posted  unless  he  is  con- 
stantly informed  by  a  reliable  source.  It  is  not  reasonable  that  we 
should  expect  other  interests  to  champion  our  cause,  and  I  would 
recommend  that  each  mine  owner,  even  if  he  is  not  a  member  of 
this  organization,  advise  his  Senator  and  Congressman  that  The 
American  Mining  Congress  is  the  representative  of  his  respective 
company  in  matters  pertaining  to  the  mining  industry  and  will 
gladly  furnish  correctly  and  concisely  such  information  as  may  be 
called  for. 

Before  the  year  closes  the  Federal  Trades  Commission  will  be 
appointed  by  the  President,  and  the  mining  industry  deserves  the 
fullest  consideration  in  the  selection  of  the  personnel  of  this  board. 
You  have  been  erquested  to  use  your  influence  in  this  direction  and 
it  will  soon  be  too  late  to  do  so,  therefore  prompt  action  is  desired. 

Many  of  us  are,  perhaps,  in  doubt  as  to  what  constitutes  unfair 
competition.  On  one  hand,  railroads  must  charge  the  same  rates, 
otherwise  their  competition  is  unfair ;  yet  if  mine  operators  pre- 
pared a  price  list  they  would  be  promptly  attacked  as  a  combina- 
tion in  restraint  of  trade  or  in  violation  of  the  State  and  National 
anti-trust  acts.  The  shipping  trust  was  declared  legal  because  it 


136  PROCEEDINGS    AMERICAN    MINING     CONGRESS 

agreed  upon  rates  and  apportioned  the  transportation  of  steerage 
passengers  from  Europe  to  this  country,  and  even  some  advantages 
were  seen  by  our  higher  court  in  this  combination.  The  Harvester 
trust  was  declared  illegal  because  it  manufactured  forty  per  cent 
of  a  certain  farm  implement.  If  there  ever  was  need  for  co-opera- 
tive work  in  any  of  the  great  industries,  the  bituminous  coal  indus- 
try deserves  the  most  immediate  and  fullest  attention  of  the  Trades 
Commission,  and  it  will,  I  am  sure,  be  accorded  every  facility  and 
assistance  at  the  hands  of  the  mine  operators  of  this  country  to 
clarify  the  drastic  conditions. 

The  recent  war  has  brought  to  our  attention  conditions  which 
we  had  not  been  obliged  to  consider  in  the  rush  and  bustle  of  our 
rapidly  growing  country.  Some  of  us  have  had  to  change  our 
views  that  a  foreign  war  would  mean  a  great  boom  to  our  indus- 
tries, that  our  coal  mines  would  be  operated  to  their  fullest  capac- 
ity to  supply  the  demand  oT  the  xavies  and  industries  of  the  for- 
eign countries,  but  with  some  minor  exceptions,  the  very  opposite 
has  been  true.  We  have  been  obliged  to  admit  to  ourselves  that 
we  are  not  as  independent  of  the  world's  trade  as  we  have  been 
led  to  believe  in  Fourth  of  July  orations  and  after-dinner  speeches. 
These  sudden  conditions  are  problems  of  the  greatest  mag- 
nitude, and  while  we  may  never  be  able  to  solve  them  in  their 
entirety,  great  relief  can  be  afforded.  They  are  not  matters  which 
can  be  settled  by  individuals,  and  while  there  may  be  leaders  doing 
more  than  their  share,  they  must  have  the  support  and  co-operation 
of  a  large  following  to  bring  about  the  most  good  to  the  greatest 
number. 

Let  me  suggest  also  at  this  time  that  the  delegates  to  this 
Convention  report  to  the  authorities  who  have  sent  them  here  the 
proceedings  and  the  work  of  this  Congress.  Do  not  believe  that  your 
duties  as  delegates  end  by  attending  these  meetings — the  real  pur- 
pose of  your  coming  here  is  to  report  at  home  what  you  have 
found  and  what  you  think  should  be  done  by  yourself  and  your 
principals.  Do  not  wait  for  the  distribution  of  the  printed  pro- 
ceedings of  this  Convention.  The  desk  of  the  busy  man  today  is 
burdened  daily  with  publications  of  this  kind  which  are  often  not 
read  for  weeks  and  months,  and  frequently  consigned  to  the  book- 
cases without  having  been  opened.  I  am  sure  a  concise  letter,  with 
a  personal  opinion  expressed,  will  do  much  more  good  than  hun- 
dreds of  pages  of  closely  printed  matter  which  remains  unread. 


PRESIDENT'S    ANNUAL    ADDRESS  137 

Another  thought  has  suggested  itself  to  me  which  I  think  it 
proper  to  bring  to  your  attention  at  this  time,  and  that  is,  the  elec- 
tion of  your  officers  and  directors.  Many  of  us  have  had  experi- 
ence with  organizations  of  a  commercial  or  social  nature  where 
much  dissatisfaction  existed  over  the  management  of  affairs.  I 
may  not  fully  appreciate  the  advantage  of  the  present  method  of 
electing  your  officers  and  directors,  which  is  left  largely  to  the  dele- 
gates at  the  annual  conventions,  but  I  believe  that  a  direct  election 
by  the  members  would  insure  greater  interest.  I  have  no  fixed 
plan  to  suggest,  and  may  be  entirely  out  of  order  to  even  com- 
ment on  the  by-law's,  which  were  undoubtedly  carefully  framed  by 
the  founders  of  this  organization,  but  I  recommend  the  considera- 
tion of  a  plan  whereby  each  member  is  given  the  opportunity  to 
select  his  choice  for  office  by  a  ballot  submitted  through  the  mail. 
It  would,  perhaps,  require  three  votes  to  make  the  final  choice. 
On  the  first  ballot  each  member  will  be  asked  to  recommend  his 
personal  choice  of  candidate  for  the  office  to  be  voted  for ;  all  but 
the  names  of  the  eight  or  ten  parties  receiving  the  greatest  num- 
ber of  votes  will  be  dropped  and  submitted  as  a  second  ballot,  upon 
the  receipt  of  which  the  third  ballot  containing  the  names  of  two 
or  three  candidates  receiving  the  greatest  number  of  votes  will  be 
submitted  for  a  final  selection.  I  am  sure  the  increased  interest 
by  the  members  will  w'ell  warrant  the  expense  and  trouble  of  such 
procedure,  each  member  having  an  equal  chance — a  privilege  so 
greatly  valued  by  the  American  voter — and  there  can  be  no  feeling 
that  certain  interests  or  individuals  take  undue  advantage  of  oppor- 
tunities. With  the  widely  scattered  membership  it  is  impossible 
to  obtain  a  full  attendance  at  these  annual  meetings,  and  votes  by 
proxy  do  not  appeal  to  me  and  may  be  very  objectionable  to  many 
others. 

The  most  successful  organizations  are  usually  managed  by 
well  paid  men,  who  give  their  entire  time  to  the  business  in  hand. 
I  do  not  believe  I  look  too  far  ahead  when  I  hope  that  this  plan 
may  be  adopted  by  this  organization  in  the  future.  While  it  is  a 
distinct  honor  to  serve  as  President  of  this  Congress,  most  of  your 
Presidents  have  been  men  who  could  only  give  you  a  part  of  their 
time,  having  to  look  after  their  own  business,  and  whatever  work 
they  have  done  for  you  has  been  at  a  sacrifice  of  their  personal 
interests.  This  work  is  of  sufficient  importance  to  require  the 
undivided  attention  of  the  best  talent,  and  that  of  several  men. 


138  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

I  know  your  Secretary  has  often  hesitated  to  ask  for  time  of  your 
officers,  knowing  the  many  calls  made  upon  them. 

I  wish  to  invite  your  special  attention  to  two  subjects  which 
are  going  to  be  discussed  at  this  session  and  which  I  regard  of  the 
greatest  importance ;  namely,  the  arbitration  of  industrial  disputes 
and  the  progress  of  the  Workmen's  Compensation  Committee.  The 
former  is  a  subject  little  discussed  up  to  this  time.  Under  our 
Constitution  no  compulsory  measure  can  be  enforced.  It  must  re- 
main a  matter  of  honor  between  the  two  interests,  to  avoid  indus- 
trial conflicts.  It  is  not  fair  to  ask  employers  to  yield  to  unreason- 
able demands  of  employes  because  of  any  special  or  unusual  busi- 
ness conditions  existing,  or  by  this  denial,  bring  about  business 
interruptions  or  even  bloodshed.  Likewise,  is  it  not  proper  that 
employers  should  take  undue  advantage  of  their  men  under  stress. 
Such  actions  encourage  discrimination  or  other  unreasonable  atti- 
tudes at  opportune  occasions.  Interruptions  to  mining  do  not  end 
by  affecting  the  employers  and  mine  owners ;  the  damage  to  the 
consumer  and  user  of  mining  products  may  be  much  greater,  i 
need  only  call  attention  to  the  expense  which  our  coal  consumers 
are  put  to  every  tw'o  years  by  storing  vast  quantities  of  coal  in  the 
face  of  uncertainty  regarding  the  renewal  of  expiring  wage  agree- 
ments. Appeal  to  the  patriotic  spirit  is  not  a  cure,  and  it  is  proper 
that  we  duly  consider  the  best  solution  of  the  subject  by  discussing- 
it  from  every  viewpoint  and  form  some  basic  opinions. 

State  Legislation  is  more  or  less  contagious — if  one  State  con- 
siders a  certain  measure,  and  particularly  one  which  meets  popular 
favor,  other  States  will  endeavor  to  adopt  it.  The  Workmen's 
Compensation  Bills  have  furnished  their  share  of  opportunity  to 
the  spectacular  politicians  by  supporting  this  popular  legislation, 
frequently  under  the  disguise  of  desiring  to  appear  more  progress- 
ive and  liberal  than  neighboring  States.  Many  bills  have  been  pro- 
posed which  are  unworthy  of  the  cause  they  represent,  and  modi- 
fications will  be  proposed  at  the  coming  sessions.  There  is  no 
question  but  that  each  industry  should  bear  the  cost  of  its  toll  of 
life  and  injuries.  The  injured  workmen  or  their  families  should 
not  be  dependent  upon  charity.  There  may  be  no  difference  be- 
tween the  services  of  a  soldier  who  draws  a  pension  for  giving  his 
services  to  his  country  to  defend  it,  perhaps,  only  for  a  short  time 
and  the  workman  who  gives  his  entire  lifetime  to  build  it  up.  The 
employer,  to  meet  these  expenses,  must  be  placed  in  a  position  to 


PRESIDENT'S    ANNUAL    ADDRESS  139 

earn  the  cost  of  this  protection.  The  schedules  of  compensation 
must  be  fair  to  both  sides,  else  the  employers  will  not  place  them- 
selves under  the  Acts,  which  are  optional  and  under  our  Consti- 
tution cannot  be  made  compulsory.  The  present  method  of  liti- 
gation is  wasteful,  deprives  the  needy  at  the  time  when  assistance 
is  of  the  greatest  value,  often  giving  the  greater  sums  to  those  least 
entitled,  at  the  expense  of  those  really  deserving.  This  condition 
should  not  be  permitted  to  continue.  My  own  opinions  differ  some- 
what from  the  expressed  view  of  our  Committee,  insofar  as  I 
believe  the  workmen  should  contribute  a  part  of  the  cost  of  this 
insurance.  It  will  make  the  plan  more  valuable  to  them.  Their 
self  interest  will  prevent  unfair  payments,  because  increases  would 
have  to  be  borne  in  part  by  themselves.  Their  ability  to  contribute 
can  only  be  measured  by  the  readiness  with  which  the  organized 
men  pay  dues  and  assessments,  about  two  per  cent  of  their  gross 
earnings  being  given  to  the  Union  fund  of  the  organized  coal  fields. 
Should  they  contribute  an  equal  amount  to  the  Compensation  fund 
in  addition  to  the  equivalent  added  by  the  employers,  we  would 
have  a  fund  of  3  cents  to  3^  cents  per  ton  of  coal,  which  is  con- 
sidered adequate  at  this  time.  Such  contributions  would  entitle 
them  to  representation  in  the  administration  of  the  fund,  which 
should  be  kept  out  of  the  reach  of  political  influence. 

The  unusually  depressed  condition  of  the  mining  industry  pre- 
vailing during  the  past  year  has  required  more  than  the  ordinary 
attention  and  time  of  the  operators  and  mining  officers,  and  has 
prevented  many  from  more  active  co-operation  with  our  w'ork. 
Your  directors  and  officers  have  not  been  able  to  give  as  much 
time  to  the  work  as  was  hoped,  nevertheless,  we  have  advanced, 
and  I  take  this  opportunity  to  thank  the  directors  and  members 
for  their  cordial  and  generous  support.  Many  promises  have  been 
made,  which  will  be  handed  as  a  heritage  to  my  successor  in  office, 
who  I  am  sure  will  be  able  to  convert  them  into  cash  as  soon  as  the 
financial  situation  improves,  and  I  feel  that  the  outlook  for  The 
Mining  Congress  is  more  encouraging  now'  than  at  any  time  since 
its  organization.  As  to  your  Secretary,  I  can  only  reiterate  what 
I  stated  at  Philadelphia,  that  he  has  been  the  main-spring  of  your 
machinery  and  to  him  is  due  the  credit  for  any  accomplishments. 


Recent  Legislation  Affecting  the  Arizona  Mining  Industry 

BY   WALTER  DOUGLAS, 
BISBEE,    ARIZONA. 


When  the  Territory  of  Arizona  achieved  its  ambition  and 
was  admitted  into  the  sisterhood  of  states,  its  legislators  sitting 
as  members  of  its  constitutional  convention  felt  it  incumbent  upon 
them  to  evolve  a  constitution  which  would  be  in  nowise  secondary 
in  progressive  principles  to  that  adapted  by  its  predecessor,  Okla- 
homa. 

To  this  end  the  XVIIIth,,  article  concerning  labor  deals  with 
certain  features  of  social  legislation  which  are  ordinarily  left  to 
legislatures  to  enact. 

Sec.  I.  of  Article  XXVIII  directs  the  legislature  to  enact  a 
law  providing  that  eight  (8)  hours  and  no  more  shall  constitute 
a  day's  work  in  all  employment  of  the  state  or  any  subdivision 
thereof. 

Sec.  II.  That  no  child  under  the  age  of  fourteen  (14)  shall 
be  employed  in  any  gainful  occupation,  nor  shall  any  child  under 
sixteen  (16)  be  employed  in  mines  or  other  hazardous  occupation. 

Sec.  III.  Declares  it  unlawful  for  an  employer  to  contract 
with  an  employee  whereby  he  shall  be  released  from  responsibility 
for  any  injuries  sustained. 

Sec.  IV.  Abrogates  the  common  law  doctrine  of  fellow  ser- 
vant, while 

Sec.  V.  Leaves  the  defense  of  contributory  negligence,  or 
of  assumption  of  risk  to  the  jury  as  a  question  of  fact. 

Sec.  VI.  Provides  that  the  right  of  action  to  recover  damages 
shall  never  be  abrogated  and  the  amount  recovered  shall  never  be 
subject  to  any  statutory  limitation. 

Sec.  VII.  Directs  the  legislature  to  enact  an  Employer's  Lia- 
bility law  by  which  the  employer  shall  be  liable  for  death,  or  injury, 
to  an  employee  due  to  the  hazard  of  the  employment. 

Sec.  VIII.  Provides  that  the  legislature  shall  enact  a  Work- 
man's Compulsory  Compensation  law  but  specifically  states  that  it 


RECENT  LEGISLATION  AFFECTING  ARIZONA  MINING        141 

shall  be  optional  with  the  employee  to  accept  compensation  or  re- 
tain the  right  to  sue. 

Sec.  IX.  Prohibits  the  exchange,  solicitation  or  giving  out 
of  a  "Black-List",  and 

Sec.  X.  That  none  but  a  citizen  of  the  United  States  shall 
be  employed  upon  public  works. 

Article  XIX.  Establishes  the  office  of  mine  inspector  and 
directs  the  first  legislature  to  enact  law's  regulating  the  operation 
and  equipment  of  the  mines  of  the  state. 

The  first  legislature  of  the  state  of  Arizona  convened  on  the 
i8th  day  of  March,  1912,  and  proceeded  to  carry  out  the  instruc- 
tions embodied  in  the  constitution  and  to  enact  of  their  own  voli- 
tion other  measures  effecting  the  mining  industry. 

Considering  the  different  laws  that  have  been  enacted  in  their 
relative  importance  and  after  over  two  year's  experience  of  their 
operation  it  would  be  proper  to  ascribe  the  first  place  to  the  mine 
inspection  bill. 

It  has  been  singularly  fortunate  for  the  state  of  Arizona  that 
some  time  prior  to  the  convening  of  its  first  legislature  the  Ameri- 
can Mining  Congress  had  appointed  a  committee  of  distinguished 
members  to  compile  a  code  applicable  to  the  conditions  obtaining 
in  metal  mines  and  that  the  rough  draft  of  its  reports  was  avail- 
able for  the  legislature  when  confronted  with  the  necessity  of 
framing  a  law  as  directed  by  the  constitution. 

With  a  few  minor  and  one  major  exception  the  code  drafted 
by  your  committee  w'as  adopted  and  became  the  present  law  under 
which  mines  are  operated  in  this  state.  It  is  a  pleasure  to  be  able 
to  say  that  state  inspection  instead  of  being  a  detriment,  or  an 
embarrassment,  in  operating,  has  become  a  positive  benefit  in  that 
it  has  kept  the  management  in  close  touch  with  underground  con- 
ditions through  the  state  inspector  and  has  assisted  those  in  direct 
charge  by  association  with  an  outside  point  of  view.  Perhaps 
part  of  the  success  has  been  largely  due  to  the  ability,  tact  and 
helpfulness  of  the  mine  inspector  who  has  converted  prejudice  and 
suspicion  into  hearty  co-operation. 

Next  in  importance  to  the  mine  inspection  is  the  Compulsory 
Compensation  Act.  The  first  legislature  found  itself  in  the  ex- 
extremely  embarrassing  position  of  having  to  frame  a  measure  of 
Compulsory  Compensation  which  under  the  wording  of  the  con- 


142  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

stitution  could  only  be  optional.  They  doubtless  did  the  best  they 
could  under  the  very  difficult  circumstances  but  the  result  has 
been  eminently  unsatisfactory  to  all  parties  concerned.  Any  law 
which  leaves  the  question  of  compensation  for  death,  or  injury,  to 
the  financial  soundness  of  the  individual  employer  is  bound  to  be 
a  hardship  on  the  employee,  as  only  responsible  corporations  are 
in  a  position  to  meet  a  heavy  loss  through  an  accident.  The  miner 
who  goes  out  to  do  assessment  work  on  one  of  the  thousands  of 
prospects,  owned  by  parties  of  small  means,  meeting  with  an  injury 
can  obtain  no  relief.  It  is  estimated  that  not  more  than  forty  per 
cent  (40%)  of  the  labor  employed  in  the  state  would  under  this 
defective  law  be  able  to  collect  damages  for  injuries,  or  death. 

I  think  it  is  a  fair  assumption  that  the  great  majority  of  the 
employers  of  labor  today  recognize  the  justness  of  the  axiom  that 
the  industry  should  bear  the  burden  of  its  hazards ;  but  it  is  only 
fair  that  the  financial  degree  of  responsibility  should  be  defined 
and  understood  by  both  parties.  A  law  which  binds  one  party  and 
not  the  other  is  in  its  very  essence  unfair  and  intolerable  and 
can  only  be  a  fertile  source  of  misunderstanding  and  distrust. 

Until  the  constitution  of  the  state  has  been  amended  making 
it  possible  to  introduce  a  system  of  state  insurance,  such  as  that 
so  successfully  operating  in  the  state  of  Washington,  or  a  com- 
pulsory compensation  bill  like  those  of  New  York  or  Massachu- 
setts the  moneys  which  in  the  ordinary  course  of  events  would 
go  to  alleviating  the  suffering  of  the  injured  will  serve  to  render 
the  ambulance  chaser  prosperous  and  contented. 

Perhaps  the  most  pernicious  law  passed  by  the  last  legisla- 
ture and  especially  aimed  at  the  mining  industry  was  the  so-called 
eight  hour  law,  which  provides  that  an  employee  shall  not  remain 
underground  for  a  longer  period  than  eight  (8)  hours  in  any 
twenty-four  hours.  This,  in  the  experience  of  the  large  mines 
of  the  state,  means  that  deducting  the  necessary  time  to  get  to 
and  return  from  the  working  place  and  half  an  hour  for  lunch 
the  miner  only  averages  seven  (7)  hours  work.  It  is  inconceivable 
that  the  framers  of  this  measure  could  have  believed  that  it  would 
inure  to  the  benefit  of  the  best  interests  of  labor.  It  is  of  that 
class  of  legislation  w'hich  endeavors  to  throttle  ambition  and  ef- 
ficiency, to  make  all  men  of  the  same  degree  of  mediocrity  and 
to  prevent  ability  and  industry  asserting  itself.  In  the  past,  and 


RECENT  LEGISLATION  AFFECTING  ARIZONA  MINING        143 

before  the  passage  of  this  law,  the  miner  or  mechanic  of  ambition 
was  glad  to  get  a  few  hours  extra  work  as  overtime  each  week 
not  only  for  the  additional  money  there  was  in  it,  but  in  order 
to  acquire  experience  in  a  class  of  labor  which  was  impossible 
during  hours  of  regular  operation.  The  result  of  the  passage  of 
this  law  has  been  that  the  average  wage  of  the  employee  has  been 
curtailed  and,  what  is  more  important,  his  opportunity  for  advance- 
ment has  been  materially  reduced.  As  a  commentary  on  legisla- 
tion of  this  class  directed  at  a  single  important  industry  it  might 
be  proper  to  mention  that  of  the  54  members  of  the  first  legis- 
lature but  7  of  them  could  be  by  the  most  liberal  construction 
classed  as  representatives  of  mining  or  had  any  practical  knowl- 
edge of  the  industry. 

It  would  be  improper  in  this  brief  review  of  recent  legisla- 
tion as  applying  to  the  mining  industry  to  dwell  at  length  on  the 
law  enacted  by  the  first  state  legislature  for  the  taxation  of  mines, 
as  this  subject  will  be  fully  discussed  at  the  meetings  of  the  Con- 
gress. 

In  conclusion,  therefore,  it  is  a  fair  assumption,  which  is 
borne  out  by  actual  experience,  that  ill-digested  legislation  such 
as  that  above  cited  has  not  been  of  financial  or  moral  benefit  to 
the  wage  earner  but  has  served  to  embarrass  an  industry  on  the 
material  prosperity  of  which  this  state  to  a  large  extent  depends. 
A  prolonged  period  of  great  depression  faces  the  copper  producers 
and  only  mutual  co-operation  and  wisely  considered  measures  can 
succeed  in  preventing  great  suffering  in  the  mining  communities 
through  further  restriction  in  the  copper  output. 


The  First  Move 

BY   W.   G.   SWART, 
DENVER,   COLORADO. 


We  have  recently  been  hearing  that  something  is  wrong  with 
the  mining  industry ;  that  the  mineral  output  does  not  keep  pace 
with  the  demand;  that  the  good  mines  are  rapidly  being  worked 
out ;  that  prospecting  is  a  "lost  art" ;  that  engineers  will  not  recom- 
mend prospects ;  that  money  for  development  is  not  to  be  had,  and 
that  only  developed  properties  can  be  marketed. 

I  am  not  going  to  say  these  assertions  are  wholly  false,  because 
the  statement  which  opens  this  discussion  is  true — there  does  seem 
to  be  something  wrong  with  the  mining  industry — but  I  do  not 
believe  the  other  statements  will  bear  the  light  of  careful  investi- 
gation. The  mineral  output  does  keep  pace  with  the  demand. 
Metal  prices  and  statistics  prove  it  directly,  beyond  question,  except 
in  the  case  of  gold,  and  since  the  price  of  gold  must  be  measured 
indirectly  we  can  only  say  that  it  seems  also  to  be  true  of  gold. 
It  certainly  is  not  true  that  all  the  good  mines  are  worked  out, 
neither  is  it  true  that  prospecting  is  a  "lost  art,"  that  engineers 
will  not  recommend  prospects,  that  development  money  cannot  be 
had,  nor  that  only  developed  properties  can  be  marketed.  Any 
or  all  of  these  things  may  be  true  in  individual  cases,  but  in  the 
aggregate  the  situation  seems  better  than  ever  before.  We  are 
simply  facing  changed  conditions  and  the  old  order  is  passing. 

Mining  must  undoubtedly  depend  ultimately  on  prospecting, 
and  like  every  other  activity  prospecting  has  had  to  change  its 
methods.  The  man  Arizona  knows  as  the  "desert  rat,"  with  his 
little  grugstake  and  his  burro,  was  in  his  day  the  efficient  pros- 
pector, but  his  burro  cannot  now  compete  with  the  automobile  nor 
can  he  himself  compete  with  the  younger  and  more  energetic  men 
who  drive  the  machines.  They  are  the  real  modern  prospectors, 
and  if  you  will  stop  a  moment  and  consider  you  will  be  forced  to 
admit  both  the  increasing  number  of  such  men,  and  their  influence 
on  result.  Some  of  these  men  are  trained  engineers,  but  many  are 
not,  and  the  statement  that  engineers  will  not  recommend  prospects 


THE    FIRST    MOVE  145 

almost  answers  itself — it  makes  little  difference,  so  long  as  a  body 
of  active  and  intelligent  young  men  is  constantly  discovering  pros- 
pects and  turning  prospects  into  mines.  It  is  also  plain  enough 
that  some  one  is  furnishing  the  money  for  this  work.  This  leaves 
partially  open  only  the  statement  that  none  but  developed  proper- 
ties can  be  sold.  Arizona  again  furnishes  an  answer.  It  is  not 
necessary  to  go  beyond  her  borders  to  show  that  some  of  the 
largest  and  best  properties  in  the  world  have  been  bought,  de- 
veloped, equipped  and  put  into  operation  within  the  past  ten  years. 
Does  anyone  question  the  willingness  of  the  men  who  did  this  to 
repeat  their  successes,  or  the  willingness  of  others  to  emulate 
them  ? 

The  real  point  to  be  noted  and  emphasized  here  is  that  these 
are  the  large  things,  the  spectacular  things,  the  unusual  things,  the 
things  requiring  enormous  capital. 

They  are  .not  the  things  requiring  discussion  here.  We  may 
take  it  as  a  firmly  established  fact  that  the  really  big  things  will 
continue  to  be  handled  by  the  really  big  men  with  their  big  re- 
sources. But  the  prosperity  and  stability  of  the  mining  industry 
depends,  in  the  last  analysis,  just  as  much  on  the  smaller  enter- 
prises, and  it  is  with  these  that  most  of  the  complaints  seem  to 
originate.  Is  there  then  a  chance  for  the  smaller  mining  operation  ? 
Can  it  be  made  attractive,  secure  and  profitable? 

Let  us  consider  for  a  moment  the  distinction  between  pros- 
pecting and  developing.  There  seems  to  be  a  very  general  impres- 
sion that  the  lucky  prospector  finds  a  mine  ready  made.  What  he 
usually  finds  is  a  "prosPect>"  which  is  simply  the  surface  indication 
of  possible  ore  beneath.  It  generally  takes  both  time  and  money 
in  liberal  amount  to  ascertain  even  its  chance  of  possible  value, 
and  this  is  called  developing.  Developing  is  the  department  of 
mining  where  the  greatest  risks  must  be  taken,  and  where,  inci- 
dentally, the  greatest  rewards  may  be  expected.  It  is  distinct  from 
prospecting,  and  is  even  more  important,  but  the  distinction  is  not 
well  understood  by  the  public  at  large.  Mining  is  much  more  apt 
to  suffer  from  lack  of  development  than  from  lack  of  prospecting. 
Development  funds  come  from  a  variety  of  sources,  not  necessary 
to  enumerate  here.  They  may,  however,  be  separated  into  two 
general  kinds — pure  speculation  and  distributed  risk.  Unquestion- 
ably the  larger  part  of  development  money  has  gone  into  the 
ground  as  pure  speculation  whether  its  owners  knew  it  or  not,  and 


146  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

like  most  other  speculations,  the  proportion  of  losses  have  been 
exceedingly  high.  The  distributed  risk  money  has  done  far  better 
but  has  not  been  so  widely  applied  to  smaller  operations.  Dis- 
tributed risk  is  merely  an  application  of  the  old  adage  "Don't  put 
all  your  eggs  in  one  basket."  Mark  Twain  criticized  this  policy, 
saying  through  the  lips  of  one  of  his  best  known  characters  that 
it  seemed  better  to  "put  all  your  eggs  in  one  basket  and  watch  that 
basket."  From  the  published  list  of  mining  stocks  included  in  his 
estate  it  is  evident  he  found  it  difficult  to  properly  watch  his  basket. 
In  reality  his  difficulty  lay  not  so  much  in  w'atching  the  basket 
as  in  selecting  both  the  basket  and  its  contents,  and  it  seems  to 
me  it  is  the  proper  selection  and  handling  of  mining  enterprises 
that  most  needs  our  consideration. 

We  all  know  that  mining  is  made  a  solid,  substantial  and 
profitable  business  by  the  larger  organizations.  The  very  best 
talent  is  employed  and  the  utmost  care  used  in  the  selection  and 
management  of  property.  As  many  selected  risks  are  assumed 
as  can  be  obtained  on  suitable  terms  up  to  the  financial  limit  of 
the  organization.  This  is  the  distributed  risk  plan  at  its  best,  and 
few  such  concerns  have  ever  failed  from  legitimate  causes. 

For  a  number  of  years  the  feeling  has  been  growing  among 
men  qualified  to  judge  that  similar  methods  might  be  applied  to 
smaller  operations.  The  idea  of  local  mining  or  exploration  syndi- 
cates is  not  new — they  have  operated  for  years  with  a  fair  percent- 
age of  successes.  A  syndicate  of  Colorado  lawyers,  under  good 
technical  advice,  took  several  million  dollars  out  of  Creede  and 
Cripple  Creek.  A  syndicate  of  school  teachers  in  another  state, 
paying  into  a  working  fund  from  $5  to  $20  a  month  each,  made 
over  $200,000  in  five  years.  It  is  easy  to  multiply  such  illustrations 
but  we  should  also  not  forget  that  there  have  been  many  failures — 
far  too  many — arising  both  from  general  and  local  causes.  It  will 
occur  to  your  minds  immediately  that  the  success  of  one  such 
organization  in  a  community  ought  to  cause  others  to  spring  up 
with  similar  aims  and  hopes.  It  does.  But  the  possibilities  are 
usually  seen  and  grasped  first  by  the  irresponsible  promoter,  and 
in  the  excitement  of  the  public  mind  the  real  merit  of  the  plan 
and  the  real  reasons  for  its  success  are  lost  sight  of  with  much 
unnecessary  loss.  This  has  happened  and  will  continue  to  happen, 
but  there  is  an  obvious  and  adequate  remedy,  and  it  is  the  appli- 


THE    FIRST    MOVE  147 

cation  of  this  remedy  which  I  have  had  in  mind  in  entitling  this 
paper  "The  First  Move." 

I  believe  the  first  move  is  a  very  definite  move  which  must 
be  systematically  made  in  each  community  by  those  best  qualified 
to  make  it,  and  they  are  the  trained  mining  engineers  and  oper- 
ators. I  do  not  mean  necessarily  the  graduates  of  mining  schools, 
but  just  what  is  said — the  trained  mining  men.  They  must  do 
what  they  have  consistently  done  in  the  past — take  the  initiative 
and  assume  the  leadership  that  is  properly  theirs.  They  must  di- 
rect mining  investment,  instead  of  only  advise  concerning  it. 

In  spite  of  all  unfriendly  criticism  of  pretensions  to  see  under- 
ground, use  of  yellow  leggings  or  partiality  toward  offices  in  the 
high  buildings,  the  fact  remains  that  nearly  every  successful  mining 
operation  of  consequence,  old  or  new,  is  today  in  the  hands  of 
experienced,  technically  trained  men.  These  are  the  men  w'ho 
select,  who  reject,  who  discriminate,  who  decide  on  the  place,  time, 
direction  and  amount  of  expenditure,  and  who  plan  and  execute 
the  work.  No  man  does  these  things  for  any  considerable  time 
successfully  without  becoming  a  business  man  of  a  high  order. 
Leadership  is  his  by  every  right,  but  unfortunately  he  has  not 
always  chosen  to  accept  it  and  turn  it  to  best  account,  even  when 
possible.  Let  me  illustrate  what  is  possible.  In  one  of  the  classes 
recently  graduated  from  a  certain  mining  school  Were  four  young 
men  who  resolved  to  pool  their  efforts  and  go  to  mining  directly 
instead  of  accepting  salaried  positions  as  assayers,  surveyors,  etc. 
At  the  end  of  five  years  they  are  in  far  better  financial  condition 
than  the  average  of  their  classmates,  they  have  had  more  real  ex- 
perience, and  they  understand  what  accepting  responsibility  means, 
but  above  all,  they  stand  absolutely  at  the  head  of  mining  affairs 
in  their  community  and  are  reaching  out  steadily  for  larger  things. 
They  have  made  good,  and  in  making  good  they  have  secured 
an  unhesitating  local  following  in  every  mining  enterprise  they  will 
take  over.  This  is  the  kind  of  leadership  I  have  in  mind.  No 
irresponsible  promoter  can  capture  that  community. 

The  one  necessary  thing  is  to  guide  and  systematize  local 
activity,  and  it  can  be  done  properly  only  by  the  trained  men.  They 
must  first  show  confidence  in  themselves,  then  build  up  the  con- 
fidence of  the  community  in  their  ability,  integrity  and  unselfish- 
ness, and  the  rest  is  easy. 

Another  illustration  of  results  actually  achieved:     A  company 


148  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

of  ten  engineers  was  recently  organized  in  Colorado,  with  modest 
capital,  and  this  company  is  already  successfully  operating  selected 
property  along  these  very  lines.  When  these  men  began  sys- 
tematically to  put  faith  behind  their  works  and  money  behind  their 
judgment,  they  took  the  first  necessary  step.  They  have  already 
secured  the  confidence  and  following  of  the  communities  in  which 
they  operate.  No  one  believes  either  that  ten  experienced  men 
can  be  seriously  misled  or  that  they  will  ever  adopt  anything  but 
a  policy  of  absolute  fairness  and  integrity.  Every  one  believed 
they  would  win,  and  they  have. 

While  this  is  not  the  place  for  details,  it  may  be  well  to  point 
out  briefly  several  interesting  features  of  this  first  move. 

1.  The  proposal   is  not  that  the  movement  be  restricted  to 
mining  engineers  and  operators — simply  that  it  must  be  organized 
and  directed  by  them. 

2.  The  movement  probably  cannot  succeed  without  the  con- 
fidence and  co-operation  of  the  business  and  professional  men  of 
the  respective  ocmmunities.     Mining  has  usually  been  only  a  side 
issue,   an   incidental,   a   speculation,    if  you   like,  with   most   such 
men.     Investing  without  proper  guidance,  their  activity  has  been 
spasmodic  and  unsatisfactory. 

3.  The  movement  must  not  only  be    started  but    be    made 
systematic  and  continuous,  otherwise  it  has  no  real  future. 

4.  The  organizers  must  be  prepared  to  make  sacrifices  of 
time  and  energy,  to  say  nothing  of  money,  and  to  sink  any  petty 
professional  jealousies ;  but  at  the  same  time  the  idea  must  not  be 
allowed  to  creep  in  for  one  moment  that  it  is  in  any  sense  a  philan- 
thropic move.     There  can  be  just  one  underlying  aim,  and  that  is 
to  make  mining  pay. 

5.  No  such   organization   can   hope  to   succeed   permanently 
which  does  not  propose  to  be  fair  and  more  than  fair  to  its  non- 
technical associates  and   stockholders.     The  plan   rests   solely   on 
confidence  in  the  ability  and  fairness  of  technical  men.     It  is  use- 
less to  start  on  any  other  basis. 

6.  It  is  not  expected  nor  necessary  that  every  engineer  and 
operator  take  an  active  part  in  such  an  organization.     Some  are 
overburdened  now ;  some  are  honorably  bound  to  organizations  al- 
ready existing ;  some  are  more  efficient  working  alone,  but  there  is 


THE    FIRST    MOVE  149 

plenty  of  available  material  in  every  mining  district,  in  every  west- 
ern city. 

7.  It  is  a  "get  together"  plan  with  indirect  as  well  as  direct 
benefits. 

8.  It  requires  no  large  amount  of  capital.    It  is  better  to  start 
modestly  and  well  within  the  means  of  the  primary  associates.     It 
is  particularly  necessary  to  assume  no  financial  responsibilities  be- 
yond the  actual  capital  in  sight.     Success  in  even  the  smallest  way 
brings  possibilities  of  growth  far  faster  than  they  can  be  properly 
cared  for.     A  good  set  of  brakes  is  much  more  essential  than  the 
high  gear. 

9.  The  mining  men  will  have  to  start  this  themselves.     No 
one  is  going  to  do  it  for  them.     No  one  ought  to  do  it  for  them. 

You  will  realize  that  this  paper  is  not  an  inquiry  into  what  is 
wrong  with  mining.  It  suggests  that  if  something  is  wrong  with 
mining  here  is  one  constructive  remedy.  It  is  a  workable  plan, 
whose  details  will  of  course  vary  with  location  and  conditions,  and 
it  is  already  in  successful  operation,  but  it  is  possible  only  to  a 
body  of  trained  men.  Undoubtedly  there  are  other  good  methods, 
but  as  I  see  the  situation,  the  underlying  idea  must  be  the  same  in 
all.  The  qualified  mining  men  ought  to  be  in  better  control  of  the 
industry  than  they  are,  and  they  can  be,  but  the  first  move  is 
theirs. 


The  Leasing  System  and  Conservation 

BY  JESSE  KNIGHT, 
PROVO,  UTAH. 


Mr.  Chairman,  I  appreciate  very  much  the  honor  but  at  the 
same  time  I  do  not  feel  competent  to  lead  this  discussion.  That 
man  from  Texas  (Dr.  Phillips)  spoke  my  mind  so  much  better 
than  I  can  myself  that  I  feel  very  incompetent  to  say  anything.  But 
I  have  a  few  ideas,  gained  through  experience,  in  regard  to  the 
leasing  question  especially.  I  do  not  believe  in  it  at  all,  from  any 
point,  either  for  the  state  or  the  government,  especially  the  govern- 
ment. I  think  if  they  are  going  to  lease,  each  state  ought  to  do  its 
ow'n  leasing.  I  think  they  know  better  how  to  handle  it  than  the 
government  does.  They  are  closer  home. 

I  suppose  this  was  intended  for  a  general  discussion  on  every- 
thing that  is  bad.  The  leasing  of  power  sites  in  these  little  moun- 
tain streams  here  in  the  West,  to  me,  always  looks  like  the  most 
ridiculous  thing  I  could  think  of  in  the  way  of  conservation.  The 
streams  are  going  to  waste,  and  so  long  as  we  do  not  interfere  with 
irrigation,  and  we  do  not  need  to  in  most  cases,  w'e  should  be  per- 
mitted to  drop  the  water  above  the  farms  and  harness  up  little 
mountain  streams  and  thus  do  a  great  good  with  them  and  develop 
the  country.  Those  streams  are  going  to  waste,  and  perhaps  will 
go  to  waste  forever,  but  when  they  lease  them  it  hinders  the  pro- 
gress of  the  country.  It  seems  to  me  it  might  be  just  as  well  to 
conserve  the  air  w'e  breathe  and  call  it  conservation  as  to  conserve 
these  mountain  streams.  I  have  been  in  the  power  business  in  a 
small  way.  In  the  first  place  we  harnessed  a  little  stream  in  San- 
taquin,  Utah,  to  take  power  over  to  the  Tintic  mines  for  our  own 
use.  We  found  quite  a  good  deal  of  difficulty  in  getting  a  right  of 
way.  It  took  about  six  months  after  we  were  ready  to  start  work 
to  get  the  right  of  way — red  tape  in  dealing  with  the  government 
officers — for  our  pipe  line  and  to  set  our  poles,  etc.,  which  makes 
it  rather  exasperating.  Then  when  we  got  one  little  plant  over 
there  w'e  found  that  we  needed  more  for  safety  and  protection,  as 
we  found  by  experience  that  one  little  plant  didn't  do  us  much 


THE    LEASING    SYSTEM    AND    CONSERVATION  151 

good,  as  the  electric  storms  would  put  us  out  of  business.  So  we 
continued  until  we  built  five  little  power  plants,  and  then  we  found 
that  we  were  leasing  in  competition  with  people  that  didn't  have  to 
lease.  The  Telluride  Power  Company,  for  instance,  in  Utah,  had 
its  rights  beforehand  and  had  titles  to  its  holdings,  and  it  was  not 
a  lessee,  and  of  course,  being  suspicious,  as  I  am,  I  was  fully  con- 
vinced that  the  men  who  got  up  that  bill  to  make  lessees  of  every- 
body else  did  it  to  head  off  competition  for  themselves.  I  think 
that  men  sometimes  do  things  as  bad  as  that.  If  you  compete  with 
them  they  don't  like  it.  They  might  have  done  it  for  that  reason 
or  they  might  have  made  people  believe  it  was  conservation,  but  I 
fail  to  see  where  it  comes  in.  I  never  could  see  any  sense  in  calling 
it  conservation  of  water  power  sites.  I  cannot  conceive  of  such  a 
thing  as  conservation  under  that  guise.  I  suppose  others  can,  but 
I  have  never  heard  any  of  them  explain  how  it  would  conserve  any- 
thing. The  more  it  would  be  used,  of  necessity  it  would  save  coal, 
but  to  leave  it  go  to  waste  forever,  how  could  it  conserve  anything? 
As  I  have  said  before,  I  haven't  heard  anybody  explain  how'  it  con- 
serves natural  resources,  but  that  is  the  pretext  they  do  it  under, 
to  prevent  monopolies  from  having  too  big  an  interest  in  a  certain 
thing,  I  suppose,  and  they  fool  the  people  right  along.  Most  of 
these  leases  and  conservation  ideas  hold  projects  back  from  the 
common  people  until  the  big  fellows  get  ready  to  use  them,  in  my 
judgment.  Now,  I  will  tell  a  little  story  that  will  apply,  maybe,  to 
what  I  want  to  say.  When  we  built  our  first  little  power  plant  there 
was  an  old  Englishman  who  had  an  irrigated  farm  below,  and  he 
protested  against  our  use  of  the  water.  We  told  him  that  we  would 
drop  it  above  all  the  farms  and  they  could  use  it  just  the  same,  and 
we  would  save  water  for  them.  It  was  running  three  or  four  miles 
through  loose  gravel  beds  and  sand  before  it  got  down  to  their 
headgates.  The  farmers  protested  quite  vigorously,  but  of  course 
they  couldn't  prevent  us,  and  when  we  got  permission  from  the 
government  we  went  ahead  and  built  our  pipe  line  along  the  side 
of  the  hill,  and  we  furnished  them  at  the  headgates  just  twice  the 
water  they  formerly  had  in  low'  water  season.  The  old  Englishman 
still  was  not  satisfied,  and  he  said,  "Well,  what  good  is  it  when  you 
take  the  electricity  all  out  of  it?"  (Laughter)  From  my  view- 
point there  is  about  as  much  common  sense  in  the  conservation  idea 
as  relating  to  power  sites,  as  there  is  in  the  old  man's  valuation 
placed  upon  the  water  after  it  has  run  over  the  wheel.  The  law's 


152  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

regulate  how  we  can  hold  them ;  we  cannot  hold  them  without  us- 
ing them,  and  to  take  them  off  the  market  in  some  instances  and 
lease  them  in  other  instances  seems  to  me  to  be  the  clearest  fraud 
ever  heard  of  in  the  name  of  conservation. 

Now,  in  regard  to  the  taxation  of  mining  property,  on  which 
we  pay  a  fuller  tax  than  is  paid  by  almost  any  other  business  in 
the  country :  In  the  State  of  Utah,  where  I  live,  in  the  first  place, 
we  pay  the  taxes  on  the  price  of  the  land  that  we  pay  the  govern- 
ment, and  we  pay  the  government  a  larger  price  for  the  land  than 
most  people  who  get  lands  from  the  government  for  other  pur- 
poses, and  until  we  find  ore,  how  can  it  be  worth  any  more  than 
what  we  gave  for  it?  I  fail  to  see  why  they  should  want  to  tax  it 
any  more  than  the  government  charged  for  it  until  it  is  shown  that 
it  is  worth  more.  The  net  proceeds  tax  seems  to  me  to  be  the  very 
best  law  that  could  be  got  at  to  make  the  miners  pay  their  equal 
proportion  of  the  taxes ;  then  we  cannot  get  around  it.  We  pay 
our  full  quota  of  taxes  in  every  sense  so  far  as  I  am  able  to  see. 

I  am  not  used  to  expressing  my  ideas,  only  in  my  own  way, 
and  I  am  not  competent  at  all  to  make  a  talk  on  the  floor  any  place ; 
but  I  admire  that  man  from  Texas,  and  he  expresses  my  sentiments 
better  than  I  do. 

I  thank  you.     (Applause.) 


Federal  Legislation  for  Alaska 

BY    FALCON    JOSLIN, 
CHAIRMAN    OF  THE   ALASKA   COMMITTEE  OF   THE    AMERICAN    MINING 

CONGRESS, 
FAIRBANKS,    ALASKA. 


The  year  1914  marks  a  new  era  in  the  history  of  Alaska.  Three 
Acts  of  Congress  of  the  highest  importance  to  the  territory  were 
passed  and  approved.  These  were :  First,  the  Act  authorizing  the 
President  of  the  United  States  to  construct  approximately  one 
thousand  miles  of  railroad  at  a  cost  not  to  exceed  $35,0x30,000; 
second,  the  Act  repealing  the  existing  laws  for  the  sale  of  coal  lands 
in  Alaska  and  providing  for  the  leasing  of  such  lands  in  the  future, 
and  third,  the  bill  reducing  taxation  on  privately-owned  railroads. 

The  policy  disclosed  in  these  bills  shows  a  very  wide  departure 
from  all  former  plans  of  the  government.  The  scheme  and  policy 
for  the  development  of  the  public  domain  since  the  very  beginning 
of  the  nation  has  been  to  grant  to  citizens  a  fee  simple  title  in  the 
soil  with  complete  and  independent  ownership.  In  railroad  develop- 
ment from  the  very  first,  the  policy  has  been  the  encouragement  of 
private  enterprise  and  private  ownership  of  the  railroad  lines  with 
governmental  aid  for  pioneer  lines  in  their  inception  and  during 
their  infancy.  There  was  indeed  in  the  earlier  years  of  manage- 
ment of  the  public  domain  some  attempt  at  establishing  a  leasing 
system,  particularly  with  reference  to  lead  mines,  but  after  some 
years  of  experiment  and  failure,  the  leasing  system  was  abandoned. 
In  the  beginnings  of  railroad  development  there  were  also  some 
experiments  in  state  ownership  as  well  as  some  experiments  in 
national  construction  of  highways,  but  these  experiments  w'ere  all 
abandoned.  About  ten  years  ago  during  the  first  "reign"  of  Roose- 
velt the  idea  was  started  that  these  old  and  well-tried  policies  of 
the  government  toward  the  disposal  of  the  public  lands  were  all 
wrong.  Private  ownership  and  control  of  the  great  railway  high- 
ways of  the  nation  was  also  subjected  to  criticism  and  hostility. 

It  happened  that  just  at  this  time  the  great  domain  of  Alaska 
was  beginning  to  attract  attention  and  immigration.  This  vast 


154  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

territory  of  nearly  600,000  square  miles  had  been  supposed  an 
arctic,  ice-covered  waste,  and  useless  except  for  furs  and  whaling. 
The  discovery  of  enormously  rich  bonanza  gold  fields  in  different 
localities  attracted  many  thousands  to  Alaska  and  its  development 
began  with  a  rush. 

In  the  decade  between  1890  and  1900,  the  population  gained 
more  than  100  per  cent.  It  was  discovered  that  the  territory  was 
not  only  valuable  for  furs,  but  contained  amazing  stores  of  gold, 
copper  and  coal  and  its  w'aters  contained  a  most  abundant  supply 
of  fish.  Railroad  building  began  in  1898.  Dozens  of  railroad  lines 
were  projected  and  surveyed  and  in  the  succeeding  ten  years  nearly 
500  miles  were  constructed.  The  law  relating  to  the  disposal  of 
coal  lands  which  prevailed  in  the  western  states  was  extended  to 
Alaska,  modified  somewhat,  but  still  in  principle  the  same.  This 
law  was  in  effect  that  the  government  offered  its  coal  lands  for 
sale  to  any  citizen  in  tracts  of  160  acres  at  the  price  of  $10  an 
acre,  the  applicant  himself  to  pay  for  the  cost  of  surveying  the 
land,  all  of  which  was  unsurveyed.  Under  the  provisions  of  this 
law  approximately  40,000  acres  of  coal  land  in  various  localities 
were  applied  for  by  several  hundred  different  citizens,  surveyed  by 
them  at  their  own  expense  and  purchased  from  the  government  and 
paid  for.  Nearly  $400,000  in  cash  have  been  paid  into  the  treasury 
of  the  United  States  as  purchase  price  of  these  coal  lands.  Per- 
haps another  $200,000  were  spent  in  surveys.  Probably  more  than 
a  million  dollars  additional  were  spent  in  the  exploring,  buildings, 
roads  and  other  development. 

There  w'as  every  indication  that  the  development  of  Alaska 
was  going  forward  in  the  same  manner  and  along  the  same  lines 
that  the  great  western  frontier  of  the  United  States  proceeded. 
But  the  new  policies  which  have  been  mentioned  were  also  gaining 
headway  and  in  the  year  1906  resulted  in  the  issuance  of  executive 
orders  which  very  promptly  brought  this  development  and  progress 
to  a  standstill.  Railroad  building  ceased.  The  proposed  opening 
of  coal  mines  immediately  stopped  and  some  mines  w'hich  were 
already  opened  closed  down.  There  is  not  a  coal  mine  operating  in 
all  Alaska.  The  development  of  the  oil  fields  also  came  to  an  abrupt 
end,  except  one  claim,  fee  simple  title  to  which  had  been  obtained 
before  the  executive  orders  were  issued.  The  executive  orders  re- 
ferred to  were  those  issued  in  November,  1906,  supplemented  by 
various  orders  during  the  next  few  months  withdrawing  all  land  in 


FEDERAL    LEGISLATION    FOR    ALASKA  155 

Alaska  containing  coal  from  sale  or  entry.  These  orders  were 
ratified  by  later  orders  in  1910.  The  fact  that  these  orders  were 
wholly  without  authority  made  them  none  the  less  effective.  For 
in  matters  relating  to  the  administration  of  the  public  lands,  full 
authority  rests  with  the  Executive  Department  of  the  government. 
The  courts  have  no  jurisdiction  either  original  or  appellate.  The 
citizen  seeking  to  acquire  public  land  has  no  right  of  access  to  the 
courts. 

The  policy  and  purpose  of  these  orders  was  quite  clearly  ex- 
pressed, although  not  in  the  orders  themselves.  Their  policy  was 
to  change  the  system  of  disposal  of  public  coal  lands  from  the 
freehold  to  the  leasehold  system.  Such  a  change  constitutionally 
and  regularly  could  only  have  been  brought  about  by  the  action  of 
Congress  through  legislation.  At  that  time,  however.  Congress  had 
not  awakened  to  the  enormous  advantages  of  the  leasehold  over 
the  freehold  system,  while  the  Executive  Department  had.  One  of 
the  executive  orders,  the  one  indeed  which  has  been  in  effect  until 
the  moment  of  the  approval  of  the  present  leasing  bill,  naively  de- 
clares that  the  orders  were  issued  "in  aid  of  legislation."  Thus 
in  addition  to  the  executive  and  judicial  po\vers  the  executive  now 
assumed  also  the  legislative  power.  We  now  have  the  Act,  approved 
October  2Oth,  1914,  to  provide  for  the  leasing  of  the  coal  lands  in 
the  Territory  of  Alaska  and  for  other  purposes,  as  the  ripened 
fruit  of  this  new  policy. 

The  Act  to  authorize  the  President  of  the  United  States  to 
locate,  construct  and  operate  railroads  in  the  Territory  of  Alaska, 
approved  March  I2th,  1914,  is  the  result  of  this  new  policy  with 
reference  to  railroads. 

More  than  three  years  ago  it  became  quite  clear  to  your 
Alaskan  Committee  that  no  progress  could  be  made  toward  the 
opening  of  Alaska  except  by  yielding  to  the  demand  for  the  change 
of  policy  above  indicated.  The  growth  and  development  of  the 
territory  had  practically  ceased.  During  the  decade  between  1900 
and  1910  the  population  had  gained  less  than  2  per  cent.  The  rail- 
road mileage  which  had  been  built,  comprised  in  seven  or  eight 
separate  lines,  was  without  exception  unprofitable.  Upwards  of 
thirty  millions  dollars  had  been  invested  in  these  railroad  enter- 
prises. The  two  or  three  hundred  men  who  had  bought  and  paid 
for  coal  lands  were  unable  to  get  any  title  thereto.  Indeed  the 
policy  of  the  Executive  Department  was  not  to  decide  the  cases  one 


156  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

way  or  the  other.  Nearly  two  hundred  of  them  had  been  subjected 
to  criminal  indictments,  most  of  which  are  still  pending.  A  few 
were  brought  to  trial  and  promptly  acquitted.  The  case  of  the 
Alaska  coal  claimants  is  probably  unparalleled  in  the  history  of  the 
nation.  They  surveyed  and  bought  the  land  at  the  price  at  which 
it  was  offered  and  paid  for  it.  But  though  the  government  took 
their  money  and  gave  receipts  for  it,  it  refused  to  give  them  title, 
at  the  same  time  retaining  their  money.  On  top  of  this  they 
criminally  indicted  the  greater  portion  of  them  for  attempting  to 
buy  land  at  the  price  at  which  it  was  offered  for  sale. 

The  infant  and  struggling  railroading  enterprises  which  in  the 
western  states,  under  similar  circumstances  had  been  subsidized  by 
government  loans  and  land  grants,  in  Alaska  were  subjected  to  ex- 
cessive taxation  and  even  the  control  of  their  management  was 
brought  under  the  Interstate  Commerce  Commission,  which  in  a 
large  measure  takes  the  control  away  from  the  ow'ners. 

Under  these  circumstances,  it  is  not  to  be  wondered  at  that  any 
further  capital  could  not  be  induced  to  go  into  Alaska.  It  became 
evident  that  if  the  territory  was  to  have  railroads  at  all,  the  govern- 
ment itself  must  build  them.  Your  committee,  therefore,  in  1912 
drafted  a  bill  containing  a  plan  for  the  construction  by  the  govern- 
ment of  not  to  exceed  one  thousand  miles  of  railroad  in  Alaska. 
Hearings  were  secured  before  the  Territories  Committees  of  Both 
House  and  Senate  and  the  plan  and  draft  bill  was  presented.  It  met 
with  favor  and  the  Senate  Committee  introduced  the  bill  as  a  com- 
mittee bill.  Though  the  bill  was  not  passed,  a  Commission  of 
Engineers  was  authorized  by  Congress  and  appointed  by  the  PresU 
dent  to  go  into  Alaska  and  report  upon  routes  and  other  matters 
relating  to  railroad  development  of  the  territory.  This  commission 
duly  reported  in  January,  1913,  and  new'  bills  were  introduced  in 
substance  and  effect  the  same  as  the  former  bill  which  had  been  pre- 
pared by  your  committee. 

Very  fortunately  when  the  Democratic  administration  came 
into  office.  Secretary  Lane  and  President  Wilson  took  up  the  sub- 
ject of  railroad  legislation  for  Alaska  and  made  the  bill  an  adminis- 
tration measure.  The  bill  met  severe  opposition  in  both  House  and 
Senate,  but  finally  overcame  all  opposition  and  became  a  law.  The 
greatest  praise  for  its  success  belongs  to  President  Wilson  and 
Secretary  of  the  Interior  Lane,  without  whose  powerful  influence 
the  measure  could  never  have  been  passed.  Your  committee,  ably 


FEDERAL    LEGISLATION    FOR    ALASKA  157 

advised  and  assisted  by  Secretary  Callbreath,  worked  unceasingly 
for  the  measure  through  three  sessions  of  Congress. 

Theoretically,  government  ownership  of  railroads  is  an  ideal 
system.  Capital  supplied  by  the  government  is  obtainable  at  about 
3  per  cent  interest,  whereas  supplied  by  bankers  or  private  indi- 
viduals it  would  cost  at  least  6  per  cent.  The  saving  in  this  item 
alone  on  $35,000,000  of  capital  amounts  to  over  $1,000,000  per  year. 
The  power  to  make  and  sustain  low  rates  in  the  beginning  and 
thereby  to  encourage  the  rapid  development  of  the  territory  served, 
is  another  very  great  advantage  of  government  ownership.  Against 
these  advantages  must  be  set  off  the  fact  that  in  government  owner- 
ship, construction  and  operation  will  probably  be  more  expensive 
than  in  private  ownership.  The  bill,  however,  provides  that  the  line, 
or  lines,  when  constructed  may  be  leased,  in  fact,  shall  be  leased 
in  case  a  satisfactory  lease  can  be  procured.  Under  the  system  of 
government  ownership  with  operation  carried  on  under  lease,  there 
is  no  reason  why  as  high  degree  of  economy  cannot  be  obtained  as 
may  be  had  under  private  ownership. 

The  bill  also  authorizes  the  President  to  either  construct  the 
lines  on  force  account,  or  let  the  construction  by  contract.  If  the 
construction  work  is  taken  under  contract,  there  should  be  as  high 
a  degree  of  efficiency  and  economy  as  if  the  roads  were  built  by 
private  owners.  The  bill  very  wisely,  as  it  seems  to  your  com- 
mittee, has  given  the  President  the  widest  and  most  complete  power. 
There  is  practically  no  limitation  upon  his  pow'er  except  that  he 
shall  not  contract  for  more  than  $35,000,000  worth  of  construction, 
the  appropriations  for  which  must  be  made  annually  by  Congress. 

The  selection  of  routes,  always  the  most  troublesome  point  in 
the  building  of  new  railroads,  is  left  entirely  with  the  President. 
This  indeed  was  the  great  point  which  brought  success  to  the  bill. 
Unless  the  discussion  of  the  various  routes  could  be  avoided,  no 
measure  could  hope  to  pass  Congress,  except  after  years  of  debate 
and  struggle. 

It  should  be  said  that  some  votes  were  cast  for  the  bill  in 
Congress  by  those  who  were  hostile  to  the  principle  of  government 
ownership.  They  thought  that  Alaska  would  be  the  most  difficult 
field  for  the  experiment  and  that  it  would  therefore  show  that 
government  ownership  will  be  a  failure.  Whether  it  is  a  failure 
or  not  depends  upon  the  administration  of  the  law. 


158  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

Your  committee  feels  that  the  American  Mining  Congress, 
having  taken  such  an  active  interest  in  the  origin  and  passage  of 
the  bill,  is  now  bound  to  do  all  in  its  pow'er  to  assist  in  its  work- 
ing out. 

Undoubtedly  there  are  many  disadvantages  in  government 
ownership.  For  example,  the  encouraging  of  emigration  by  adver- 
tising and  other  means  usually  employed  to  increase  population  will 
be  difficult  for  the  government.  The  exploiting  of  mineral  and 
other  resources  for  the  building  up  of  traffic  and  the  extension  of 
spurs  and  branches  cannot  be  well  done  by  the  government.  But 
none  of  these  disadvantages  are  such  that  they  may  not  be  over- 
come by  careful  and  earnest  effort. 

The  political  aspects  of  government  ownership  is  probably  the 
most  risky  and  dangerous  of  all  features  of  government  owner- 
ship. Whether  the  selection  of  routes  and  of  personnel,  the  grant- 
ing of  contracts,  the  making  of  rates  and  the  operation  of  the 
property,  can  be  carried  forward  under  government  ownership  free 
from  political  influences  of  fear  or  favor,  is  a  highly  important 
question  in  the  w'orking  out  of  the  law. 

The  work  has  already  begun ;  a  Commission  of  Engineers  has 
been  appointed  by  the  President  who  have  spent  the  past  season 
in  Alaska  in  making  surveys  and  who  will  shortly  make  their  re- 
port and  recommendations.  It  is  to  be  hoped  that  construction 
will  begin  during  the  summer  of  1915  and  that  prosperity  for 
Alaska  will  follow  immediately. 

THE  COAL  BILL. 

Three  years  ago  the  Alaskan  Committee  of  the  American  Min- 
ing Congress,  though  all  without  exception  opposed  to  the  principle 
of  leasing  coal  lands,  nevertheless  drafted  and  supported  before 
Congress  a  bill  for  leasing  coal  lands  in  Alaska — not  that  it  be- 
lieved in  the  principle,  but  that  it  was  the  only  way  to  get  action. 

When  the  bill  which  has  now  become  a  law  was  first  intro- 
duced in  the  Congress  which  has  just  expired,  your  committee  con- 
sidered it  a  reasonably  fair  leasing  law.  Members  of  your  com- 
mittee being  called  upon  appeared  before  the  House  Committee  on 
Public  Lands  and  supported  the  measure,  providing  certain  amend- 
ments were  incorporated  in  it.  When  the  bill  was  reported  from 
the  Public  Lands  Committee  of  the  House,  it  was  in  such  condition 
that  your  committee  felt  its  passage  would  be  an  outrage  and  made 


FEDERAL    LEGISLATION    FOR    ALASKA  159 

every  effort  to  secure  its  amendment.  Many  of  the  amendments 
proposed  by  your  committee  were  adopted  and  incorporated  in  the 
Act;  others  were  rejected. 

One  of  the  most  vicious  things  in  the  measure  is  the  provision 
that  deprives  any  of  the  existing  coal  claimants  of  the  right  of 
access  to  the  courts.  The  bill  proposes  to  lease  the  identical  lands 
which  the  government  has  heretofore  sold.  It  is  the  law  that  a 
citizen  may  not  sue  the  government,  but  it  also  is  the  law  that  if 
the  government  sells  a  tract  of  land  to  a  citizen  and  afterwards 
attempts  to  transfer  the  same  tract  to  another  citizen,  the  first  pur- 
chaser may  bring  suit  against  the  second  when  he  enters  into  pos- 
session and  thereby  get  judicial  consideration  of  his  right  in  the 
courts.  If  the  first  purchaser's  right  is  decided  to  be  superior,  then 
the  second  claimant  will  be  declared  by  the  courts  to  hold  the  land 
as  trustee  for  the  first  purchaser  and  be  required  to  yield  up  pos- 
session and  title  to  him.  Congress,  with  the  cunning  device  con- 
tained in  Section  13  of  the  bill,  proposes  to  legislate  the  Alaska 
coal  claimants  out  of  this  right  of  access  to  the  courts.  It  will 
probably  prove  futile,  but  the  malignant  purpose  is  no  less  dis- 
couraging. It  should  not  be  forgotten  that  murderers  and  the  most 
abandoned  criminals  are  entitled  to  their  day  in  court.  It  is  prob- 
ably the  first  time  in  the  history  of  the  nation  that  Congress  has 
attempted,  with  conscious  purpose  and  design,  to  deprive  its  citizens 
of  this  right.  Always  before  the  spirit  has  been  to  give  every  citi- 
zen the  right  of  fair  hearing  in  the  courts  and  full  right  of  appeal. 
It  will  not  inspire  confidence  in  those  who  are  invited  by  the  bill 
to  take  leases  in  the  future.  If  their  predecessors  who  bought  and 
paid  for  the  coal  lands  are  to  lose  their  improvements,  and  suffer 
the  ignominy  of  criminal  indictment  and  finally  be  deliberately 
legislated  out  of  their  right  of  trial  by,  or  appeal  to  the  courts  of 
the  land,  it  may  well  make  prospective  leasers  pause  before  they 
venture  to  invest  large  capital  where  such  things  can  be  done  and 
go  unrebuked.  However  daring  the  men  who  go  to  Alaska,  the 
capital  that  hereafter  is  invited  there  must  be  timid  with  such  a 
record  before  it. 

However,  no  new  and  novel  propaganda  to  change  the  laws 
is  at  present  afoot.  The  building  of  the  railroads  and  the  arctic 
climate  will  be  powerful  arguments  in  favor  of  opening  coal  mines 
and  your  committee  earnestly  hopes  that  the  leasing  law1  will  work 
as  well  as  its  most  vigorous  supporters  have  hoped. 


Conservation  of  Mineral  Resources;  State  or  National? 

BY  DR.   WILLIAM  B.  PHILLIPS, 
AUSTIN,    TEXAS. 


During  the  last  years  a  great  deal  has  been  said  and  written 
concerning  the  conservation  of  our  mineral  resources.  There  has 
been  a  widespread  awakening  of  the  public  interest  and,  one  may 
add,  of  the  public  conscience  on  this  subject. 

It  has  been  treated  from  practically  every  standpoint,  so  that 
it  would  not  appear  to  be  an  easy  task  to  discuss  it  further. 

In  spite  of  this,  however,  and  largely  because  of  it  I  venture 
to  tax  your  patience  in  an  effort  to  set  forth  what,  to  me,  are 
the  fundamental  principles  of  this  matter. 

There  are  three  things  to  which  your  earnest  attention  is  re- 
quested; these  are  as  follow's: 

First — There  can  be  no  conservation  without  systematic  de- 
velopment. 

Second — There  can  be  no  real  conservation  without  recog- 
nized and  regulated  authority. 

Third — There  should  be  no  conservation  that  does  not  press 
equally  upon  all  concerned. 

Conservation  has  three  things  to  deal  with,  development,  regu- 
lated authority  and  equality. 

We  do  not  conserve  our  mineral  resources  by  the  enactment 
of  laws  which,  in  effect,  are  prohibitory,  nor  do  we  properly 
develop  them  by  loosely  drawn  and  insufficient  laws.  Development 
that  does  not  develop  is  worse  than  conservation  that  does  not 
conserve,  for  it  closes  the  only  door  through  which  we  may  enter 
upon  a  wise  conservation. 

Our  mineral  wealth  must  be  developed  for  our  own  use  and 
benefit,  with  due  regard  to  the  needs  of  those  who  are  to  follow  us. 

The  conservation  of  undeveloped  resources  is  a  contradic- 
tion in  terms.  It  is  worse  than  this,  for  it  distracts  attention 
from  the  main  issue  and  substitutes  for  it  an  idea  which  has  no 
sure  foundation.  The  real  value  of  an  undeveloped  resource  is 


CONSERVATION    OF    MINERAL    RESOURCES  161 

a  thing  which  no  one  has  yet  been  able  to  elucidate  except  in  the 
light  of  a  similar  resource  which  has  been  developed  under  fairly 
comparable  conditions. 

There  are  communities  and  even  entire  states  that  are  today 
hoarding  their  undeveloped  resources  without  knowledge  what 
they  are.  This  is  one  of  the  commonest  experiences  of  the  capi- 
talist, the  mining  geologist  and  the  mining  engineer. 

"Why,  sir,  the  resources  of  this  state  (county  or  district,  as 
the  case  may  be)  are  perfectly  enormous.  There  is  enough  iron 
ore  in  our  hills  to  supply  a  thousand  furnaces  a  thousand  years. 
Enough  gold  and  silver  to  pay  off  the  national  debt.  Enough  cop- 
per to  copper-plate  the  sun,  moon,  stars  and  other  flag  stations 
of  the  universe.  Enough  oil  to  grease  the  wheels  of  Time  and  lubri- 
cate the  mills  of  the  Gods  that  grind  so  slowly.  Enough  natural 
gas  to  consume  the  earth  and  leave  of  it  only  a  pile  of  sinter,  sur- 
mounted by  a  salamander." 

Who  of  us  has  not  heard  such  eloquent  descriptions  of  unde- 
veloped resources?  And  who  of  us  has  not  found,  to  his  cost, 
that  the  gas  was  the  only  thing  that  had  been  developed? 

We  are  sometimes  disposed  to  think  of  conservation  as  a  thing 
separate  from  development,  as  a  thing  that  can  be  considered  on 
its  own  merits.  We  say  that  such  and  such  resources  should 
be  conserved,  but  how  can  they  be  conserved  if  they  are  not  devel- 
oped? How'  can  one  conserve  a  resource  whose  development  is 
not  yet  within  the  sphere  of  commercial  activity?  We  do  not  con- 
serve a  pair  of  boots  by  greasing  them  and  putting  them  away 
in  the  closet,  nor  do  we  conserve  a  mineral  resource  by  refusing 
or  neglecting  to  develop  it.  If  there  were  a  more  systematic 
and  a  wiser  development  we  should  hear  less  of  conservation  and 
of  the  intricate  and  delicate  questions  that  lie  on  the  borderland 
between  present  emergencies  and  future  probabilities. 

What  we  need,  the  country  over,  is  not  less  conservation  but 
more  development,  not  less  of  the  spirit  of  saving  but  more  of 
the  spirit  of  giving,  the  giving  of  our  time,  our  means,  ourselves 
to  the  task  of  building  a  prosperous,  far-seeing  and  economical 
nation. 

It  is  not  to  be  denied  that  in  some  cases  improper  develop- 
ment has  caused  conservation  to  assume  the  guise  of  necessity, 
but,  taking  the  country  as  a  whole,  we  are  today  in  far  more  ur- 


162  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

gent  need  of  development  than  of  conservation.  Furthermore,  the 
insistence  upon  conservation  has,  in  some  instances,  retarded  the 
development  upon  which  our  prosperity  must  be  based.  We  have 
put  the  cart  before  the  horse,  much  to  the  discouragement  of  that 
worthy  animal. 

The  threatened  depletion  or  exhaustion  of  the  mineral  re- 
sources of  the  country  upon  which  our  rank  as  a  nation  must  de- 
pend is  much  less  serious  than  some  of  our  friends  would  have  us 
think. 

Take,  for  instance,  the  coal  resources  of  the  country.  Accord- 
ing to  the  best  information  available  the  total  coal  area  in  the 
United  States  is  373,000  square  miles.  The  original  supply  of  coal 
is  thought  to  have  been  about  2,750,000,000,000  tons,  of  which 
11,000,000,000  tons,  or  0.4  per  cent  have  been  removed. 

If  we  allow  that  that  original  supply  was  one-half  of  such 
estimates  as  have  been  made  and  that  the  exhaustion  has  been 
twice  as  great  as  we  have  reason  to  believe  we  still  find  that  we 
have  no  appreciable  demand  upon  our  coal  supplies. 

Perhaps  more  has  been  said  as  to  the  conserving  of  our  coal 
supplies  than  almost  anything  else.  In  the  very  nature  of  our 
circumstances  we  make  a  greater  demand  upon  such  supplies  than 
upon  any  other  mineral  resource  and  this  demand  increases  year 
by  year.  But  we  do  not  find  that  we  have  exhausted  the  supply 
to  an  appreciable  extent.  In  parts  of  the  country  and  with  spe- 
cial kind  of  coal  it  may  be  that  the  principles  of  a  sound  conserva- 
tion do  now  apply,  but  that  they  apply  to  the  country  as  a  whole 
may  well  be  doubted. 

If  there  are  portions  of  the  country  that  are  suffering  from 
lack  of  conservation  there  are  far  greater  portions  that  are  suf- 
fering from  lack  of  development.  If  there  are  cases  of  deplora- 
ble waste  in  some  of  our  mining  operations  there  are  multiplied 
instances  of  a  far  greater  waste  through  undeveloped  resources 
that  w'ould  contribute  to  our  prosperity. 

We  must  preach  the  doctrine  of  a  wise  development,  for,  in 
that  case  conservation  will  take  care  of  itself.  I  do  not  decry  con- 
servation that  really  conserves.  I  merely  point  out  that  develop- 
ment is  for  us  now  the  far  more  important  consideration. 

We  come  to  our  second  heading;  there  can  be  no  real  con- 
servation without  recognized  and  regulated  authority. 


CONSERVATION  OF  MINERAL  RESOURCES       16a 

We  enter  at  once  upon  some  of  the  most  important  questions 
of  state  and  national  administration. 

If  we  allow  that  self  interest  does  not  and  will  not  impel  us 
towards  a  wise  conservation  we  can  hope  for  it  only  through  gov- 
ernmental control.  There  is  no  use  in  blinking  at  this  for  it  con- 
fronts us  inexorably.  If  the  natural  laws  of  profit  and  loss  are 
not  sufficient  to  cause  us  to  protect  ourselves  and  our  children 
we  come  surely  to  the  more  or  less  artificial  laws  of  human  enact- 
ment and  execution. 

Before  we  face  this  emergency  and  have  to  deal  with  it  we 
must  decide  whether  it  w'ould  not  be  better  for  the  growth  of  a 
self-reliant  citizenship  to  work  out  our  own  salvation  with  as  little 
help  from  the  government  as  possible. 

The  wisdom  of  government  is  the  wisdom  of  the  people  who 
compose  it.  We  do  not  enlarge  the  intelligence  or  add  to  the  wisdom 
of  a  man  by  electing  him  to  office,  or  making  him  the  Chairman 
of  a  Commission,  or  the  head  of  a  Bureau.  We  may  increase  his 
sense  of  responsibility,  but  this  does  not  necessarily  imply  that  he 
knows  more  or  can  use  his  knowledge  to  better  advantage.  It 
is  not  so  much  what  he  knows  as  what  he  should  know,  not  so 
much  what  he  does  as  what  he  should  do.  There  is  many  a  man 
who  is  busy  all  day  and  half  the  night,  but  whose  activities  are 
those  of  a  child  writing  his  name  in  water.  Activity  is  not  to 
be  confused  with  usefulness.  If,  as  State  or  Nation,  we  are  to 
enter  upon  a  real  conservation  we  must  do  so  with  our  eyes  open 
and  with  a  full  realization  of  what  it  will  mean.  I  do  not  approve 
or  condemn  such  a  course,  I  merely  say  that  we  must  know  whether 
what  we  propose  to  do  is  worth  doing  and,  if  so,  how  to  do  it. 

If  w'e  are  to  set  a  minimum  price  for  a  barrel  of  oil,  by  law, 
it  is  but  one  step  and  that  an  inevitable  one  to  controlling,  by  law, 
all  of  the  agencies  concerned  in  the  production  and  distribution 
of  that  oil.  If  we  are  to  disregard  the  time-honored  law'  of  supply 
and  demand  and  substitute  for  it  some  human  contrivance  that 
seems  to  appeal  to  our  present  needs  we  must  accept  the  conse- 
quences of  our  action.  It  is  oil  today,  copper  tomorrow  and  lead 
next  week.  Also,  if  the  owners  of  that  oil  refuse  to  sell  it  at 
the  price  named  there  is  no  way  of  disposing  of  it  save  through 
the  agency  that  fixed  the  price,  viz.,  the  government. 

It  is  quite  beside  the  mark  to  say  that  a  combination  of  in- 


164  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

terests  may,  by  wholly  artificial  means,  increase  the  price  w'hich 
the  statute  seeks  to  lower,  for  the  price,  in  the  long  run,  is  fixed 
by  conditions  over  which  no  special  interest  or  combination  of 
interests  have  any  control  whatsoever. 

If  the  government,  under  the  guise  of  law,  can  fix  a  minimum 
price  for  a  mineral  product  it  can  also,  under  the  guise  of  law, 
increase  the  price.  But  no  government  of  the  kind  we  have  in 
this  country  has  yet  been  able  to  force  producers  to  take  less  for 
their  product  than  it  is  worth  or  to  force  consumers  to  pay  more 
than  it  is  worth.  It  might  as  w'ell  undertake  to  pass  laws  regu- 
lating the  obliquity  of  the  ecliptic,  which  would  be  a  shameful 
thing  to  do,  even  in  times  of  profound  peace. 

There  are  some  who  say  that  we  have  already  departed  from 
the  old  conceptions  of  the  powers  of  a  republican  form  of  govern- 
ment and  that  we  are  now  doing  things  that  the  founders  of  this 
Nation  did  not  contemplate  or  provide  for.  Be  that  as  it  may. 
But  so  long  as  we  hold  to  a  government  of  the  people,  by  the  peo- 
ple and  for  the  people  w'e  need  not  exercise  ourselves  over  purely 
academic  questions.  It  is  a  case  of  allowing  the  dead  to  bury 
their  own  dead. 

If  there  is  to  be  recognized  and  regulated  authority  for  the 
conservation  of  our  mineral  resources  it  will  be  because  you  and 
I  ask  for  it. 

If  there  is  to  be  compulsory  arbitration  of  industrial  dis- 
putes— a  matter  closely  connected  with  both  development  and  con- 
servation— it  will  be  because  you  and  I  ask  for  it.  If  there  is  to 
be  state  or  national  supervision  of  our  resources  it  will  be  because 
you  and  I  ask  for  it. 

No  one  is  to  force  these  things  on  us.  We  take  them  or 
reject  them  according  to  our  best  judgment.  If  we  are  willing 
that  the  government  should  do  things  for  us  that  we  have  not 
done  for  ourselves  it  will  do  them,  but  we  must  bear  the  cost. 
We  must  remember  that  conservation — which  looks  towards  the 
future — cannot  be  separated  from  the  development  of  the  present. 
If  we  are  to  turn  over  to  the  government  the  conservation  of  our 
mineral  resources  we  turn  over  to  the  government  the  develop- 
ment of  our  mineral  resources.  Private  and  corporate  money 
may  still  be  expended,  but  the  determination  of  the  necessity  for 
the  expenditure  will  be  in  the  hands  of  the  government — our  own 
government,  if  you  will,  established  and  maintained  by  ourselves 
but  still  the  government. 


CONSERVATION  OF  MINERAL  RESOURCES       165 

There  seems  to  be  no  escape  from  the  logic  of  the  situation. 

In  so  far  as  concerns  certain  phases  of  the  matter  it  will 
make  no  great  difference  whether  the  regulating  pow'er  is  state  or 
national,  but  it  may  be  submitted  that  the  conservation  of  resources 
which  affect  our  standing  among  other  nations  is  for  our  con- 
sideration as  a  Nation,  not  as  a  Union  of  States.  It  is  when  we 
speak  as  a  nation  that  we  receive  attention.  It  is  the  Spirit  of 
the  Nation  that  thinks,  decides  and  executes.  We  are  comparable 
to  a  hive  of  bees  among  whom,  as  Maeterlinck  has  so  beautifully 
shown,  it  is  the  Spirit  of  the  Hive  that  determines  the  course  of 
action. 

Here,  however,  we  trench  upon  matters  that  do  not  particu- 
larly concern  us  at  this  time.  One  may  refer  to  them  merely  to 
point  out  that  national  conservation  is  a  thing  apart  from  conserva- 
tion among  or  by  the  several  states. 

It  has  been  held  by  the  supreme  court  that  the  pow'er  to  pre- 
vent the  transferal  of  mineral  products  from  one  state  into  an- 
other state  does  not  reside  in  any  state.  There  may  be  a  deple- 
tion of  the  resources  of  a  state  by  such  procedure,  but  it  cannot 
be  prevented  by  state  legislation.  This  is  a  far-reaching  decision, 
especially  when  we  reflect  that  the  exportation  of  mineral  products 
is  a  national  not  a  state  matter.  We  export  as  a  nation,  not  as 
separate  states  or  an  assemblage  of  states. 

Finally,  there  should  be  no  conservation  that  does  not  press 
equally  upon  all  concerned. 

If  our  coal  resources  are  to  be  conserved  so  must  our  re- 
sources in  iron,  copper,  silver,  lead,  zinc,  oil,  natural  gas,  etc. 

We  may  not  single  out  a  particular  industry  and  begin  to  con- 
serve it  without,  at  the  same  time,  taking  into  our  view  the  con- 
servation of  other  industries,  similar  or  dissimilar. 

If,  as  a  state  or  nation,  we  decide  that  such  and  such  re- 
sources are  being  depleted  too  rapidly  now  there  will  come  a  time 
when  the  same  decision  will  be  made  with  respect  to  other  re- 
sources. 

The  power  to  conserve  one  is  the  power  to  conserve  all.  The 
power  to  fix  the  price  for  one  mineral  product  is  the  power  to  fix 
the  price  for  all  mineral  products.  Furthermore,  in  this  general 
power  there  are  included  minor  powers,  such,  for  instance,  as  the 
compulsory  arbitration  of  industrial  disputes  which,  in  effect,  is 


166  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

the  pow'er  to  regulate  wages,  the  determination  of  inland  freight 
rates,  with  which  we  are  already  familiar,  etc. 

It  is  just  possible  that  we  have  not  sufficiently  considered 
what  conservation  really  means.  It  means  governmental  control 
over  agencies  of  production  which  we  have  not  been  able  to  con- 
trol ourselves  to  the  best  advantage.  This  control,  to  be  thoroughly 
effective,  must  be  exercised  either  by  the  state  or  by  the  nation, 
the  one  or  the  other,  not  both,  separately  not  conjointly.  Partner- 
ship of  authority,  in  matters  of  this  kind,  is  not  likely  to  work 
out  to  the  satisfaction  of  either  party. 

There  may  be  co-operation  in  work  but  there  cannot  be  co- 
operation in  authority,  if  we  are  to  attain  the  best  results.  There 
may  be  advice  and  suggestion,  more  or  less  pertinent,  but  the  final 
decision  must  be  with  some  man  or  set  of  men  representing  one 
source  of  authority. 

Whether  or  no  we  are  ready  to  do  these  things  remains  to 
be  seen  but  I  take  the  liberty  of  pointing  out  the  direction  in  which 
we  shall  probably  travel  if  we  make  a  start. 

Industrial  matters  today  represent  so  complicated  a  system  of 
production,  distribution  and  sale  that  we  can  hardly  touch  one 
part  without  affecting  other  parts.  This  is  true  not  only  of  our 
own  country  but  of  all  the  trading  world.  We  are  knit  together 
in  bonds  so  intimate  that  it  is  difficult  to  select  a  single  natural 
resource  that  is  free  from  this  universal  law  of  interdependence. 
The  development  of  any  great  material  resource  is  felt  over  the 
entire  world.  It  is  for  this  reason,  among  others,  that  the  exten- 
sion of  the  power  of  government,  whether  state  or  national,  should 
be  scrutinized  with  the  utmost  care. 

Let  us  not  be  hasty  in  this  matter. 

If  it  is  best  that  we  do  this  thing  let  it  be  done  only  after 
every  factor  has  been  weighed  and  every  condition  given  its  true 
value. 

The  American  Mining  Congress  is  composed  of  men  who  rep- 
resent the  development  of  our  resources  as  a  nation.  It  concerns 
itself  with  matters  of  national  importance  rather  than  with  those 
of  a  more  restricted  character.  Its  discussions  take  a  wider  view 
and  its  decisions  are  based  on  broader  foundations. 

We  do  not  meet  as  citizens  of  a  slate  but  as  citizens  of  a 
nation  whose  sole  purpose  should  be  to  consider,  in  fairness,  pa- 
tience, intelligence  and  hopefulness  matters  affecting  the  welfare 
of  the  entire  country. 


What  Must  Be  Done  to  Stimulate  the  Mining  Industry 

With  Special  Reference  to  Western  Mining  and  the 
Protection  of  Mining  Investors 

BY    E.     P.    SPALDING, 
SPOKANE,     WASHINGTON. 


The  mining  industry  is  one  of  the  great  legitimate  basic  indus- 
tries of  the  country,  as  well  as  one  of  the  most  profitable.  To 
maintain  it  as  such,  prospects  and  undeveloped  mining  properties 
of  merit  must  be  developed  and  means  for  financing  the  develop- 
ment work  devised. 

Some  one  has  said  that  mining  is  the  greatest  basic  industry 
of  the  world,  as  well  as  the  oldest,  next  to  the  industry  of  raising 
babies.  Not  being  an  expert  in  this  latter  industry  I  shall  confine 
my  remarks  to  the  next  oldest,  the  mining  industry. 

The  demand  for  developed  mines  and  mining  properties,  at 
prices  affording  good  profits  on  the  development  investment,  is 
large  and  constantly  increasing,  whereas,  there  is  a  constantly 
increasing  shortage  of  such  developed  mining  properties.  On  the 
other  hand  there  are  numerous  prospects  and  partly  developed 
mining  properties  which  merit  development  to  a  greater  or  less 
extent  under  intelligent,  skillful  and  conservative  management. 

The  owners  of  these  prospects  and  partly  developed  mining 
properties  are  usually  men  of  limited  mining  experience,  and  lack- 
ing the  necessary  means  for  the  development  of  their  properties 
to  a  point  where  they  can  be  sold  to  the  large  mining  concerns, 
or  operated  as  going  profitable  mines.  These  large  mining  con- 
cerns will  rarely  undertake  the  development  of  prospects  into  mines, 
preferring  to  await  the  full  and  complete  blocking  out  of  the  ore 
bodies  and  paying  a  much  larger  price  for  the  same  than  they 
would  have  to  pay  upon  a  development  basis  plus  the  cost  of 
development. 

With  these  conditions  prevailing,  namely,  a  large  demand  for 
developed  mines  on  the  one  hand,  and  on  the  other  hand  an  al- 
most absolute  lack  of  developed  properties  with  which  to  fill  this 
demand,  the  question  naturally  arises,  "what  are  the  underlying 
causes,  and  why  is  money  for  development  hard  to  get?" 


168  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

To  my  mind  there  are  a  variety  of  causes  for  these  condi- 
tions. They  involve  the  prospector,  the  wildcatter,  the  mining 
engineer  and  the  mining  capitalist. 

The  Prospector :  We  have  all  listened  to  his  story  many  times 
and  have  patiently  inspected  his  glittering  specimens  and  high 
grade  assays,  and  frequently  have  gone  with  him  to  inspect  the 
"lo-foot  vein  of  ore  which  the  specimens  and  assays  represent 
an  average,  and  if  anything  a  little  poorer  than  the  average", 
only  to  find  once  more  that  the  imagination  was  greater  than  the 
facts.  If,  perchance,  he  has  really  discovered  an  ore  body  of  merit 
and  has  done  sufficient  work  on  it  to  warrant  development  on 
a  more  extensive  scale,  he  usually  demands  the  price  of  a  fully 
developed  mine  and  shows  his  faith  (?)  by  demanding  terms  that 
not  only  are  not  warranted,  but  are  foolish  from  a  business  point 
of  view.  Hence  he  is  unable  to  do  business  with  serious  respon- 
sible people,  nor  does  he  get  his  prospect  developed.  On  the  con- 
trary he  is  frequently  fooled  by  glittering  promises  into  tying  his 
property  up  to  unscrupulous  imposters  or  wildcatters  and  often 
to  his  serious  damage,  and  always  to  the  detriment  of  the  mining 
industry. 

The  Wildcatter:  He  is  the  unprincipled  highwayman  of  the 
mining  industry  who  robs  both  the  prospector  and  the  public,  and 
who  has  done  more  to  bring  legitimate  mining  into  bad  repute 
with  the  small  investor  than  many  producing  mines  can  overcome. 
The  desire  to  invest  and  speculate  in  mining  is  inherent  in  most 
red-blooded  people,  but,  with  the  history  of  the  devastation  of  the 
wildcatter  fresh  in  memory,  the  cause  of  the  difficulty  of  getting 
money  from  small  investors  for  co-operative  mining  development 
is  quite  apparent.  Thanks  to  an  aroused  public  opinion  acting 
through  official  channels,  the  race  of  the  wildcatter  is  about  run. 

The  Mining  Engineer:  He  is  at  fault,  in  individual  cases, 
largely  through  a  desire  to  make  a  record  for  conservatism  at 
the  expense  of  his  employer  and  frequently  to  his  pecuniary  loss. 
I  know  of  instances  where  meritorious  mining  properties  have 
been  turned  down  by  engineers  for  no  other  apparent  cause. 
Sometimes  he  is  at  fault  through  ignorance  or  lack  of  mining  ex- 
perience and  without  the  latter  his  opinion  on  the  merits  of  a 
prospect  or  partly  developed  mining  property  should  have  but 
little  weight.  Much  theory  and  little  practical  experience  some- 
times is  not  only  dangerous  but  expensive.  In  other  individual 


WHAT  MUST  BE  DONE  TO  STIMULATE  MINING  169 

cases,  I  am  sorry  to  say,  he  is  at  fault  from  reasons  of  wrongful 
personal  gain.  Generally  speaking,  however,  the  trained  and  ex- 
perienced engineer  is  worthy  of  our  full  confidence,  respect  and 
admiration.  He  should  be,  and  usually  is,  a  many  sided  man,  able 
and  competent  under  trying  and  difficult  circumstances  and  fear- 
lessly honest  in  his  profession. 

The  Mining  Capitalist:  He  is  at  fault  nearly  always  in  the 
eyes  of  the  prospector,  because  he  demands  some  value  and  reason- 
able business  terms  for  his  money.  In  other  words,  to  use  a 
homely  phrase,  he  demands  a  "run  for  his  glass  alley".  Those 
of  us  who  were  once  boys  will  understand  that  term  and  appre- 
ciate its  full  meaning.  But,  altogether  too  frequently,  the  capi- 
talist is  too  drastic  in  his  demands,  and  not  infrequently  is  unre- 
sponsive to  the  rights  of  the  little  fellow',  be  he  prospector,  pro- 
moter or  minority  stockholder.  I  remember  recently  hearing 
through  a  New  York  correspondent  of  a  mining  proposition  of 
merit  presented  there,  wherein  the  capitalist  demanded  eighty  per 
cent  of  the  proposition  for  equipping  the  property  without  any 
cash  payment  to  the  owners,  leaving  them  but  twenty  per  cent 
out  of  which  they  had  to  pay  the  brokers  commission.  To  a 
Western  miner  with  a  proposition  of  merit,  that  looks  like  plain  rob- 
bery. It  is  hardly  necessary  to  state  that  business  did  not  result 
and  in  consequence  the  property  lies  idle  and  of  no  benefit  to  the 
mining  industry. 

What,  then,  is  the  remedy?  We  must  have  mines  and  these 
mines  must  be  developed  from  prospects  in  the  original  case. 
How,  then,  are  w'e  to  bring  prospector  and  investor  together  on 
a  basis  where  the  investor  will  be  fully  protected  in  his  investment 
in  the  co-operative  development  of  the  prospect  into  the  productive 
mine,  and,  how  are  we  then  to  bring  seller  and  buyer  together  for 
mutual  profit  and  with  mutual  respect? 

My  answer  is,  through  an  organization  that  will  occupy  the 
middle  ground  between  the  prospector  on  the  one  hand  and  the 
large  mining  concerns  on  the  other  and  with  the  small  investors 
co-operating  with  that  organization,  who,  under  proper  safeguards, 
may,  through  such  an  organization,  safely  make  their  investments 
in  the  co-operation  of  developing  for  profit,  meritorious  mining 
properties  for  sale  or  operation.  These  investments  can  be  so 
made  and  so  protected  that  sooner  or  later  the  investment  will 
be  returned  with  a  substantial  profit. 


170  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

This  must  all  be  done  under  the  skillful  management  of 
trained  and  experienced  engineers,  business  men  and  miners. 
The  prospector  must  be  taught  to  reasonably  value  his  holdings 
and  to  permit  the  development  of  his  property  under  reasonable 
and  business  like  terms.  The  wildcatter,  if  any  there  be  at  large, 
must  be  absolutely  put  out  of  business.  The  small  investor  must 
be  encouraged  and  taught  that  mining  is  not  only  legitimate,  but 
that  conducted  under  proper  management,  properly  financed  and 
with  proper  safeguards,  is  both  profitable  and  as  safe  as  any  mer- 
cantile or  manufacturing  business,  or  so-called  industrial.  When 
so  taught  and  encouraged  by  actual  experience,  then  will  it  be 
possible  to  stimulate  the  mining  industry  to  a  productiveness  never 
before  reached. 

Such  an  organization  as  is  mentioned  herein  is  now  in  process 
of  formation,  the  objects  and  purposes  of  which  are,  primarily, 
the  stimulating  of  the  mining  industry  in  the  West  by  the  develop- 
ment for  sale  or  operation  of  meritorious  prospects  and  partly 
developed  mining  properties  and  especially  gold  properties,  under 
favorable  long-time  bond  and  lease,  and  to  bring  seller  and  buyer 
together  for  mutual  profit.  Its  scheme  of  financing  is  such  and 
is  so  surrounded  with  proper  safeguards  as  to  commend  it  to  small 
investors  who  are  assured,  under  this  plan,  ,of  safety  and  a  rea- 
sonably large  profit.  All  money  invested  under  this  plan  will  be, 
in  fact  must  be,  spent  in  or  upon  the  property  or  properties  under 
development,  reasonable  charges  for  engineering  and  management 
being  considered  a  legitimate  and  necessary  part  of  the  develop- 
ment expense. 

Under  this  plan  also,  the  small  investor,  while  secured  in  his 
investment,  has  the  assurance  of  the  major  part  of  all  profits 
derived  from  development,  promotion  and  sale,  or  operation  of 
the  property,  and  his  interests  are  recognized  as  paramount  to 
all  else.  The  plan  has  been  pronounced  sound,  feasible  and  equit- 
able by  bankers,  lawyers,  business  men  and  engineers  to  whom 
it  has  been  submitted  and  by  whom  it  has  been  criticised  and 
perfected.  It  offers  a  new  freedom  to  the  small  investor  for  co- 
operative and  profitable  investment  in  the  mining  industry,  a  free- 
dom from  the  unscrupulous  and  the  wildcatter,  and  a  basis  upon 
which  he  may  share  in  the  legitimate  profits  of  mining. 

We  are  at  the  dawn  of  a  new  day  in  mining;  the  day  of 
practical,  systematic  and  scientific  prospecting  and  accomplishment 


WHAT   MUST   BE  DONE  TO   STIMULATE   MINING  171 

along  commercial  lines.  The  day  of  the  mining  boom  and  the 
mining  rush  with  all  its  glittering  folly  is  past.  The  day  of  legiti- 
mate commercial  mining  is  here.  The  highly  speculative  or  gam- 
bling feature  of  mining  is  passing.  The  day  of  the  picturesque 
has  passed.  No  longer  will  the  honored  mule  while  straying  from 
camp  be  the  discoverer  of  future  Bunker  Hill  &  Sullivans.  No 
longer  will  the  storied  "Red  Eye",  the  red  light  and  the  gam- 
bling resorts  represent  the  beginnings  of  civilization,  nor  the  de- 
bauchers  of  the  prospector  in  the  future  mining  camp.  The  pros- 
pector of  the  future  will  be  a  trained  man,  properly  equipped  and 
financed  and  sent  out  by  an  organization  of  the  character  described. 
His  work  will  be  done  systematically  and  along  practical  lines  in 
conformity  with  modern  experience  and  conditions  backed  by  sci- 
ence and  knowledge. 

The  results  of  this  modern  system  can  be  but  stimulating  and 
beneficial  to  the  mining  industry  and  I  believe  that  industry,  when  so 
conducted,  will  merit  and  have  the  support  of  the  small  investors 
who,  in  the  past,  have  largely  been  the  prey  of  wrong  conditions 
and  of  the  unscrupulous  and  dishonest  wildcatter.  Honesty  and 
fair  dealing  in  mining  will  reap  the  same  rewards  as  in  commer- 
cial or  industrial  pursuits.  Let  us  have  more  of  it. 


The  Proper  Advertising  of  Mining  Opportunities 

BY   DR.    JAMES  E.   TALMAGE, 
SALT    LAKE    CITY,    UTAH. 


We  live  in  an  advertising  age,  and  mining  like  every  other 
systematized  activity  is  concerned  in  the  modern  art  and  practice 
of  public  exploitation.  It  is  of  record  that  the  earliest  printed  per- 
iodical, devoted  to  the  dissemination  of  news,  issued  in  the  year 
1622 ;  but  not  until  another  quarter  of  a  century  had  sped  its  way, 
that  is  to  say  in  1647,  did  the  first  newspaper  advertisement  ap- 
pear. That  pioneer  in  a  new  field  was  a  simple  announcement  of 
a  book  consisting  of  a  compilation  of  religious  and  theological 
essays.  Publishers  in  the  early  days  possessed  some  of  the  now 
rare  element,  modesty,  as  a  constituent  part  of  their  being,  and 
they  regarded  with  some  sense  of  propriety  if  not  of  sanctity,  their 
precious  columns.  However,  books  both  good  and  bad,  and  par- 
ticularly medicines  guaranteed  to  cure  any  and  every  disease 
known  and  unknown,  soon  became  subjects  of  regular  advertise- 
ments, though  all  announcements  of  such  were  printed  in  small 
type  with  simple  and  unobtrusive  head-lines.  The  earliest  news- 
paper advertisement  of  a  trade  commodity  dates  back  to  1658, 
when  there  appeared  in  a  London  weekly  an  announcement  as  to 
where  could  be  bought  material  for  the  then  new  beverage,  Tea. 

From  such  small  beginnings  do  great  things  come.  Today 
advertising  is  cultivated  and  practiced  as  a  combined  art  and  sci- 
ence, and  as  the  expert  in  the  profession  knows,  success  therein 
depends  largely  upon  on  understanding  of  philosophy  and  psychol- 
ogy. Now,  advertisements  exceed  news  in  the  columns  of  many 
newspapers,  and  the  advertising  pages  in  some  of  the  magazines 
double  the  otherwise  needful  weight  and  bulk  of  each  copy. 

We  recognize  today  three  principal  methods  of  advertising  in 
print : 

(i)  By  signboards,  posters,  and  display-signs,  of  innumer- 
able varieties. 


PROPER  ADVERTISING  OP  MINING   OPPORTUNITIES         173 

(2)  Through  the  pages  of  periodicals,  both  newspapers  and 
magazines. 

(3)  By  distributing  circulars  in  great  numbers  through  the 
mails. 

The  last  named  is  practically  the  only  one  of  the  three  with 
which  the  mining  world  is  particularly  concerned ;  and  it  moreover, 
is  the  one  selective  method,  for  the  promoters  endeavor  to  send 
their  printed  matter  to  the  people  who  are  thought  to  be  directly 
interested  in  the  kind  of  enterprise  which  the  circulars  are  in- 
tended to  exploit. 

Well  developed,  productive,  and  paying  mines  are  not  adver- 
tised as  a  rule,  by  any  of  the  methods  specified.  There  is  a  very 
natural  tendency  to  keep  a  really  good  thing  in  mining  properties 
among  the  few  who  are  fortunate  enough  to  acquire  holdings  while 
the  stock  was  cheap ;  and  who  have  had  the  ability  and  good  sense 
to  retain  the  same.  Prospects  of  undemonstrated  and  uncertain 
value,  are  made  subjects  for  widespread  advertisements,  usually, 
as  stated,  by  the  circularizing  method,  and  many  are  they  who  are 
caught  thereby,  more  frequently  to  their  sorrow  than  joy. 

The  real  prospector,  he  of  the  pick,  shovel  and  pack-mule,  is 
no  party  to  the  advertising  scheme ;  when  the  mails  begin  to  be 
burdened  with  printed  matter  respecting  his  find,  it  is  a  sure  in- 
dication that  the  property  has  ceased  to  be  his,  and  has  passed  into 
the  possession  of  an  entirely  different  species  of  prospector,  who 
probably  could  with  difficulty  distinguish  the  pick  from  the  shovel 
or  the  burro  from  its  pack;  and  whose  place  of  work  is  not  the 
hole  in  the  ground  but  the  well-furnished  office ;  whose  chief  as- 
sistant is  no  hardy  miner  but  a  pretty  stenographer ;  and  whose 
pay-streak  is  the  inherent  weakness  of  human  nature. 

The  element  of  chance,  which  enters  so  largely  into  all  mining 
operations,  the  ever  alluring  possibility  of  a  "get-rich-quick"  op- 
portunity, lead  many  to  seize  the  glittering  bait  offered  through 
the  circular  advertisement,  though  they  have  not  experience, 
knowledge,  or  judgment  enough  to  see  whether  the  bait  is  flesh, 
fish,  or  fowl,  or  only  a  glittering  spoon-bait  with  the  hooks  in  plain 
sight. 

The  safe  and  reasonable  w'ay  is  to  regard  every  circularized 
mining  proposition  with  caution  if  not  with  suspicion.  The  stand- 
ing of  reliable  companies  is  or  should  be  set  forth  in  the  official 


174  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

reports  of  the  president  and  directors ;  and  the  would-be  investor, 
if  prudent,  may  ascertain  from  such  reports  and  by  personal  in- 
quiry the  merits  of  the  mine. 

If  mining  properties  are  to  be  advertised  at  all,  public  senti- 
ment and  if  necessary  legislation  should  be  invoked  to  denounce 
and  punish  dishonest  promoters  who  seek  to  entrap  the  unwary 
and  unwise,  by  presenting  possibilities  as  certainties.  No  one  knows 
better  than  the  really  practical  miner,  the  competent  mining  en- 
gineer, and  the  experienced  mining  geologist,  how  much  there  is 
about  mining  that  we  do  not  know;  nor  do  any  realize  better  than 
these  that  we  have  learned  some  things  about  mineral  occurrences, 
and  that  we  can  speak  with  relative  certainty  on  many  matters  re- 
lating to  ore  deposits  and  the  reliable  indications  thereof.  In  any 
advertising  of  mining  property  the  promoter  ought  to  be  com- 
pelled to  state  only  the  facts  such  as  a  skilled  and  trustworthy  ex- 
aminer would  attest,  and  to  make  clear  the  risk  involved  in  the  en- 
terprise. 

It  is  true  that  many  of  the  promised  advantages  associated 
with  circularized  mining  properties  are  so  plainly  exaggerations 
and  misrepresentations  that  the  duped  victims  thereof  are  deserv- 
ing of  little  sympathy.  Admitting  this  without  question  we  are 
still  confronted  by  the  facts  that  such  glaring  misrepresentations 
are  essentially  criminal,  and  that  the  mining  profession  and  indus- 
try is  the  ultimate  sufferer  therefrom.  The  spirit  of  American 
law'  is  unquestionably  set  against  wilful  deception  and  fraud,  how- 
ever great  the  ignorance  and  guilelessness  of  the  thoughtless  vic- 
tims. 

It  is  a  practical  certainty  that  much  of  the  misrepresentation 
embodied  in  promoters'  advertisements  is  chargeable,  in  part  at 
least,  to  the  optimistic  reports  made  by  incompetent  or  dishonest 
examiners,  many  of  whom  profess  a  standing  among  "mining  ex- 
perts" though  lacking  practical  experience  as  miners  and  technical 
training  as  mining  engineers  or  geologists.  If  advertisers  be  re- 
quired, either  through  stress  of  public  opinion  or  by  legislative  pro- 
vision, to  support  their  promises  and  claims  by  the  authority  of 
competent  men  who  have  examined  and  reported  on  the  properties 
offered  to  the  public,  there  should  be  a  strong  and  effective  pro- 
scription against  untrained  and  unreliable  men  posing  under  the 
objectionable  but  nevertheless  current  designation  "mining  ex- 
perts." One  of  the  great  drawbacks  to  real  progress  in  intelligent 


PROPER   ADVERTISING   OP   MINING   OPPORTUNITIES         175 

prospecting,  and  in  the  legitimate  inducement  of  capital  to  fur- 
ther the  enterprise,  is  the  unreliability  of  the  professional  exam- 
iners of  mining  properties  whose  reports  are  made  the  basis  of  un- 
warranted and  exaggerated  claims.  We  all  know  that  the  honor- 
able, high,  and  useful  profession  of  the  mining  engineer  and  the 
mining  geologist  is  infested  by  many  parasites  who  stand  to  the 
competent  mining  men  as  the  proverbial  quack  stands  to  the  worthy 
physician. 

It  is  needless  to  affirm  that  every  proper  advertisement  of  an 
opportunity  in  mining  should  be  fair  and  honest,  which  is  but  an- 
other way  of  saying  truthful.  If  the  mining  property  to  be  ad- 
vertised offers  a  real  opportunity  for  advantageous  development 
and  subsequent  productiveness,  this  truth  should  be  so  set  forth 
with  the  supporting  evidence  afforded  by  the  report  of  competent 
examiners ;  but  to  proclaim  a  certainty  where  only  a  possibility  ex- 
ists is  not  only  to  speak  but  to  commit  a  pernicious  falsehood. 

The  most  effective  safeguard  against  the  continuation  of  dis- 
honest methods  in  advertising  mining  opportunities  is  that  of  pro- 
fessional and  public  opposition  thereto.  I  consider  it  strictly  within 
the  legitimate  activities  of  this  Congress  to  set  its  seal  of  disap- 
proval on  the  pretentions  of  untrained  and  unqualified  men  in  all 
departments  of  the  mining  business,  and  to  demand  in  no  uncertain 
tones  integrity  and  uprightness  on  the  part  of  all  who  seek  to  pro- 
mote and  to  advertise  properties  and  opportunities  offering  gain 
in  mining.  Public  opinion,  encouraged  and  supported  by  the  in- 
fluence of  this  great  organization,  will  be  stronger  than  legislative 
enactment  however  radical  or  drastic.  I  do  not  recommend  as  es- 
sential to  reformation  in  the  matter  of  mine  promotion  the  creation 
of  new  laws,  either  state  or  national,  but  the  strict  enforcement  of 
existing  statutes,  and  the  spirit  of  the  common  law,  w'hich  may 
perhaps  with  allowable  variation  be  called  the  "common  sense  law," 
of  right  doing.  It  is  impossible  to  advertise  extensively  except 
through  the  use  of  the  United  States  mail;  and  existing  laws  di- 
rected against  the  illegal  use  of  the  mails  are  sufficiently  compre- 
hensive if  only  enforced.  In  the  process  of  extensively  circulariz- 
ing any  mining  property,  good  or  bad,  some  intelligent  mining  men 
would  be  reached  through  the  mails.  If  they  find  in  the  literature 
sent  to  them  the  element  of  fraud,  misrepresentation,  and  deceit,  it 
should  be  considered  by  each  of  them  a  duty  to  report  the  matter 
to  the  postal  authorities  and  place  in  official  hands  the  evidence  of 


176  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

the  offense.  We  have  already  on  record  a  few  cases  of  conviction 
and  punishment  for  criminal  misrepresentation  of  facts  in  connec- 
tion with  mining  properties  in  which  the  charge  of  illegal  use  of 
the  mails  w'as  proved.  These  examples  have  had  a  wholesome  ef- 
fect and  a  persistent  following  up  of  this  aggressive  course  cannot 
fail  in  time  to  reduce  the  criminal  practice  to  a  minimum.  In  the 
intersts  of  legitimate  mining  let  us  be  united  in  determined  and 
aggressive  opposition  against  all  species  of  untruthful  advertising. 


The  Mining  Industry  of  Arizona 

BY  CHARLES  B.  CLAPP, 
TUCSON,  ARIZONA. 


It  is  rarely  customary  for  those  travelers  who  visit  different 
countries  for  a  fe\v  days  or  weeks  to  apologize  for  writing  and  talk- 
ing about  the  people  and  industries  that  they  have  hardly  more 
than  seen.  However,  I  am  going  to  break  from  the  custom  and 
apologize  for  talking  about  the  mining  industry  of  Arizona,  since 
I  have  been  in  Arizona  only  somewhat  more  than  a  year,  and  since, 
strictly  speaking,  I  am  not  a  mining  engineer,  but  a  geologist ; 
and  perhaps  some  of  you  may  remember  what  Professor  Haultain1 
of  Toronto  said  at  the  Ottawa  (1913)  meeting  of  the  Canadian 
Mining  Institute,  when  he  compared  a  geologist  to  a  mining  en- 
gineer. Neither  do  I  wish  to  attempt  to  review'  the  mining  geology 
of  Arizona ;  that  has  already  been  done  admirably  in  a  few  pages  by 
Mr.  Lindgren2;  and  in  addition,  the  Director  of  the  U.  S.  Geolog- 
ical Survey  states  that  Mr.  Ransome  is  preparing  a  summary  of 
the  geology  and  ore  deposits  of  Arizona,  to  be  published  shortly3. 

I  came  down  to  Arizona,  as  far  as  my  own  personal  ambitions 
were  concerned,  to  get  acquainted  with  the  mining  industry.  Not 
having  been  here  very  long,  I  can  give  you  only  those  things  which 
have  impressed  me  most  during  my  year's  residence.  In  Arizona, 
as  elsewhere,  the  big  things  and  the  very  small  things  impress  one 
most.  The  biggest  thing  in  Arizona  is  its  climate.  If  it  could  be 
exported,  I  believe  we  could  make  the  Arctic  region  comfortable, 
we  could  make  the  moon  a  summer  resort,  or  we  might  make  even 
the  "effete  East"  into  "A  Man's  Country." 

But  aside  from  the  climate,  the  mining  industry  is  the  biggest 
feature  of  Arizona.  Of  this  industry,  as  you  all  know,  approxi- 
mately 90  per  cent  is  copper.  Further,  of  this  90  per  cent,  approxi- 
mately 99  per  cent  conies  from  four  districts,  comparatively  small, 
geographically  speaking.  These  are  the  Clifton-Metcalf  district, 

Canadian  Mining  Jour.,  Vol.  34,  1913,  pp.  182-185. 
3The  Mining  Districts  of  the  Western  United  States.     Bull.  507,  U.  S. 
Geol.  Survey,  1912,  pp.  14-17. 

3Thirty-fourth  Ann.  Kept.  Director  U.  S.  Geol.  Survey,  1913,  p.  42. 


178  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

the  Bisbee-Warren  district,  the  Globe-Ray-Miami  district,  and  the 
Jerome  district.  But  the  mines  of  these  districts  are  big  mines. 
and  the  companies  operating  them  are  big  companies.  It  would 
take  scarcely  more  fingers  than  I  have  on  my  two  hands  to  count 
the  companies  responsible  for  99  per  cent  of  the  production  from 
these  four  districts,  and  it  would  not  take  the  fingers  on  one  hand 
to  count  the  big  corporations  behind  these  big  mining  companies. 

Whether  this  is  a  good  thing  or  not,  it  is  a  fact.  Personally, 
I  think  it  is  a  good  thing,  but  very  probably  not  for  the  same  rea- 
son that  some  of  you  may  think  it  is  a  good  thing.  I  believe  it 
is  a  good  thing  because  these  big  companies  can  employ  geologists, 
and  all  do.  Some  of  the  companies  call  them  geologists  and  some 
call  them  by  other  names.  But  just  as  Shakespeare  says,  "a  rose 
by  any  other  name  would  smell  as  sweet,"  so  a  geologist  by  any 
other  name  may  know'  as  much. 

Mr.  T.  A.  Rickard,  among  many  others,  has  said  that  the  de- 
velopment of  our  natural  resources  presents  three  main  problems — 
first,  the  amount  of  stuff ;  second,  the  average  value  of  the  stuff ; 
and  third,  the  turning  of  the  stuff  into  cash.  You  may  employ  a 
mining  engineer  to  estimate  the  amount  of  stuff,  or  a  prospector 
may  be  the  man,  but  in  so  far  as  he  is  dealing  with  the  amount  and 
occurrence  of  that  stuff,  he  is  dealing  with  geology.  It  is  the  work 
of  the  mining  engineer  and  the  business  man  to  turn  the  stuff  into 
cash.  I  think  that,  as  a  rule,  the  mining  engineer  can  determine  the 
value  of  it  much  better  than  can  a  geologist,  for  he  has  more 
patience ;  but  in  order  to  work  these  tremendous  geological  bodies 
and  convert  them  into  money  producers,  the  engineer  and  the  busi- 
ness man  must  have  geoloical  knowledge.  They  need  it  to  initiate 
some  definite  working  plan.  Without  it  they  cannot  approach  the 
ideal  of  every  modern  undertaking  in  the  exploitation  of  resources. 
Mr.  Hayes,  formerly  chief  geologist  of  the  Survey,  has  defined  this 
ideal  in  national  terms,  as  utilization  with  a  maximum  efficiency 
and  a  minimum  waste.  In  other  words,  conservation  at  its  best  is 
merely  good  business.  Courage  in  business  is  not  recklessness.  It 
is  the  daring  that  comes  from  knowledge.  Whether  these  big  com- 
panies are  the  best  and  the  wisest  conservationists  is  still  an  open 
question,  but  it  is  in  their  favor  that  when  they  desire  greater  effi- 
ciency, they  employ  better  educated  men.  By  better  educated  men, 
I  do  not  necessarily  mean  men  with  more  school  training.  But  I 
mean,  as  was  said  this  morning,  men  with  more  brains  and  better 


THE  MINING  INDUSTRY  OF  ARIZONA  179 

developed  brains.     It  matters  not  where  the  training  w'as  received, 
through  school  training  or  through  experience. 

The  smallest  things  in  Arizona  are  three :  The  small  mine  op- 
erators, the  School  of  Mines,  and  the  amount  of  money  which  the 
state  of  Arizona,  through  its  legislature,  gives  to  the  upbuilding  of 
its  main  industry.  It  is  practically  nil.  I  say  "practically  nil" 
because  it  is  not  quite  so.  It  used  to  be  so,  but  for  some  reason  my 
salary  was  this  year  transferred  onto  the  University  fund.  This  is 
practically  nil. 

Dr.  Phillips  said  last  night  that  the  ratio  of  expenditures  by 
the  legislature  for  agriculture  and  mining  is  four-to-one,  but  the 
ratio  is  much  greater  than  that.  This,  it  seems  to  me,  is  the  fault 
not  of  the  legislature  but  of  the  mining  men.  It  is  chiefly  due  to 
the  fact  that  they  have  no  definite  organization,  which  we  hope  will 
not  be  the  case  after  this  meeting;  and  it  is  partly  due  to  the  fact 
that  they  have  not  educated  the  legislators  and  the  small  operators 
to  an  appreciation  of  the  situation.  The  agriculturists,  on  the  other 
hand,  are  educating  themselves  and  the  public.  They  demand  a 
new  building  and  get  it.  They  make  more  demands — naturally  and 
rightly.  But  it  has  come  to  a  point  where  granting  those  demands 
must  be  at  the  expense  of  the  mining  industry. 

A  farming  man  of  the  state  said  last  w'eek  in  Tucson — perhaps 
not  really  believing  what  he  said — that  Arizona  would  eventually 
be  a  farming  state,  that  everything  would  be  a  farming  state,  that 
farming  would  go  on  when  mining  was  dead  and  buried  and  for- 
gotten. He  did  not  say  how  he  planned  to  dig  his  potatoes  with 
a  piece  of  w'ood  or  what  not. 

This  is  a  wrong  attitude.  It  is  imperative  that  it  should  be 
corrected,  and  it  is  only  the  mining  men  who  can  correct  it.  We 
want  to  make  the  mining  school  an  exponent  of  conservation.  We 
want  to  make  it  efficient.  But  we  cannot  make  it  efficient  unless 
we  have  the  means  with  which  to  do  it.  I  am  not  one  w'ho  believes 
that  school  training  is  a  panacea  for  all  the  ills  of  the  mining  in- 
dustry. But  with  most  of  you,  I  do  believe  that  education  is  a 
near  remedy  for  some  of  our  present  troubles.  If  our  farmer  friend 
had  been  broadly  or  even  sensibly  educated,  could  he  have  spoken 
as  he  did  ?  Who,  but  the  mining  men,  can  educate  the  people  of  the 
state  to  an  appreciation  of  what  the  proper  development  of  Ari- 
zona's greatest  industry  can  do  for  Arizona? 


180  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

Education,  like  mercy,  is  twice  blessed,  and  blesses  him  that 
gives  and  him  that  takes.  It  is  the  theory  of  democracy  that  when 
the  state  gives  to  its  youth,  the  youth  grown  to  man's  estate  shall 
return  manifold  to  the  state.  One  shall  interpret  or  enforce  its 
law's ;  another  shall  gather  and  loan  its  monies ;  another  shall  stimu- 
late and  direct  its  commerce ;  another  shall  till  its  fields ;  shall  none 
be  taught  to  find  and  exploit  the  treasures  of  its  mountains? 


Conservation  of  Western  "Water  Power  Resources 

BY    E.   A.    WEDGWOOD, 
SALT  LAKE  CITY,   UTAH. 


The  incapacity  of  the  human  mind,  and  the  complexity  of 
human  affairs,  is  such  that  no  man,  however  capable,  can  give  all 
current  affairs  the  thought  and  investigation  necessary  to  marshall 
the  facts,  sense  their  effect,  and  work  out  a  judicial  opinion  in 
relation  thereto.  Therefore  popular  ideas  on  many  subjects  are 
but  mere  impressions. 

Probably  no  jingle  of  words,  used  as  a  "catch"  phrase  to  in- 
dicate a  policy,  or  course  of  action,  has  created  more  impressions 
upon  the  minds  of  citizens,  unfounded  in  fact  and  judicial  con- 
clusion, than  the  words  "Conservation  of  Natural  Resources". 

To  conserve  natural  resources  is  not  to  waste.  Not  to  waste 
demands  opposite  acts  and  conduct  as  to  different  resources.  If 
the  resource  be  active  it  must  not  be  left  unused  and  unproductive. 
If  dormant,  it  must  not  be  expended  unnecessarily,  carelessly  or 
without  valuable  results. 

This  brings  to  the  fore  the  character  of  natural  resources  to 
be  conserved.  We  will  consider  falling  water,  the  metals  and 
coal. 

Falling  water  is  an  active  resource.  Power  is  inherent  therein. 
If  not  captured,  it  is  unused,  unproductive  and  wasted. 

The  metals  in  common  use  naturally  lie  captive  in  the  heart 
of  the  mountains.  When  mined  and  converted  into  form  for  com- 
mercial use  they  are  made  into  articles  useful  for  the  time,  in 
due  course  becoming  obsolete  and  finding  their  way  to  the  junk 
heap  from  which  they  emerge  in  different  form  time  and  again 
with  but  a  percentage  of  loss. 

Coal  measures  present  a  different  question.  In  so  far  as  coal 
is  devoted  to  beneficial  uses  this  resource  is  consumed,  even  as  to 
by-products.  A  portion  of  the  mined  supply  is  necessarily  con- 
sumed for  the  production  of  heat,  but  that  portion  used  for  the 
development  of  dynamic  energy  is  unnecessarily  used  wherever 
water  power  may  be  practically  substituted  therefor. 


182  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

Where  coal  is  so  consumed  for  power  three  losses  necessarily 
occur — the  loss  of  the  coal  itself,  which  might  be  conserved  for 
use  of  future  generations — the  loss  of  the  inherent  power  of  idle 
water,  which  flows  on  wastefully  to  the  sea — the  loss  of  the  cost 
of  transportation  from  the  mine  to  place  of  use,  which  is  simply 
wasted  energy. 

The  transformation  of  the  inherent  power  of  falling  water 
into  revolving  wheels,  located  miles  distant,  consumes  nothing  but 
the  final  toll  demand  by  the  junk  heap. 

From  the  foregoing,  it  seems  obvious  that  conservation  of 
natural  resources  demands  immediate  development  of  available 
water  powers,  and  that  such  factors  as  stand  in  the  way  are 
antagonistic  to  actual  conservation. 

Three  factors  control  the  development  of  Western  water  power 
resources :  The  right  to  the  perpetual  use  of  flowing  waters.  The 
right  to  occupy  the  necessary  public  lands  for  dams,  power  houses, 
water  conduits  and  pole  lines.  Money  sufficient  to  construct  dams, 
water  conduits,  power  houses  and  transmission  lines. 

These  factors  are  controlled  by  different  interests. 

In  the  states  of  the  arid  West,  where  the  law  of  riparian 
rights  has  been  practically  abandoned,  and  within  which  large  and 
valuable  mining  interests,  developed  and  undeveloped  and  depend- 
ent upon  power,  are  situate,  the  flowing  waters  of  the  natural 
streams,  not  heretofore  appropriated,  are  the  property  of  the  state, 
and  w'here  not  navigable,  wholly  under  the  control  of  the  state. 

The  lands  upon  which  dams  and  power  plants  must  be  con- 
structed and  over  which  water  conduits  and  transmission  lines 
must  be  built,  are,  in  general,  the  property  of  the  United  States, 
tinder  the  control  of  the  interior  department,  subject  to  congres- 
sional enactment. 

Funds  for  the  development  of  water  powers,  in  the  immediate 
future  at  least,  must  be  furnished  by  private  capital. 

It  is  therefore  evident  that  these  diverse  interests  must  unite 
upon  common  ground  if  progress  is  to  be  and  conservation  accom- 
plished. 

The  greater  portion  of  the  area  of  the  Western  arid  states 
is  unoccupied,  public  domain,  mountainous  and  desert  in  character. 
In  one,  but  30  per  cent  of  its  lands  in,  or  in  process  of  transfer  to, 
private  ownership  and  this  30  per  cent  carries  the  burdens  of  the 


CONSERVATION   OF  WESTERN   POWER   RESOURCES          183 

state.  These  states  are  anxious  for  the  advancement  of  their  re- 
sources. To  that  end  their  laws  permit  a  corporation  or  individual, 
upon  proper  application  and  the  payment  of  a  reasonable  fee,  to 
become  the  ow'ner  of  a  perpetual  right  to  the  use  of  the  flowing 
waters  of  the  natural  streams. 

The  principal  resources  of  these  states  are  mining,  agricul- 
ture and  stock  raising. 

Stock  raising  is  dependent  upon  agriculture,  agriculture  upon 
irrigation,  and  mining  and  irrigation  upon  flowing  water  and 
power.  The  development  of  water  resources  develops  all. 

Under  such  laws  and  conditions,  private  capital  and  the  state 
readily  join  hands  for  development.  The  only  question  to  be  set- 
tled being,  will  development  be  profitable? 

The  third  factor  is  the  right  to  the  use  of  a  few  acres  of 
desert  land  for  power  site  and  rights  of  way,  which,  in  themselves, 
are  valueless  for  other  useful  purposes.  By  reason  of  ownership 
of  these  lands,  the  Federal  government,  through  congress  and  the 
departments,  apparently  assumes  to  control  water  power  develop- 
ment and  therefore  the  progress  and  material  welfare  of  those 
states. 

Ought  the  mere  ownership  of  a  few  acres  of  desert  lands 
give  this  power?  All  lands  in  private  ow'nership  are  subject  to  the 
law  of  eminent  domain.  If  Federal  ownership  does  carry  such 
power  and  the  law  of  eminent  domain  does  not  apply  to  such  lands, 
ought  Federal  power  over  these  lands  to  be  used  to  retard  the  pro- 
gress of  a  state  and  prevent  the  conservation  of  its  natural  re- 
sources ? 

The  Interior  Department  holds  that  where  power  developed 
from  falling  water  is  to  be  used  for  a  purpose  other  than  irrigation, 
permits  for  rights  of  w'ay  and  power  sites  can  issue  only  under  the 
law  of  Congress  of  February  15,  1901,  (31  Stat.  L.  790)  the  clos- 
ing words  of  which  act  are : 

''And  provided  further  that  any  permission  given  by  the  Sec- 
retary of  the  Interior  under  this  act  may  be  revoked  by  him  or  his 
successor,  in  his  discretion,  and  shall  not  be  held  to  confer  any  right 
or  easement  or  interest  in,  to,  or  over  any  public  land,  reservation 
or  park." 

This  ruling  has  been  in  force  for  aproximately  four  years  and 
water  power  development  in  the  West  has  been  substantially  at  a 


184  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

standstill.  This  must  necessarily  be  under  such  conditions.  The 
construction  of  a  hydro-electric  power  plant  involves  the  expendi- 
ture of  hundreds  of  thousands  and  oft-times  millions.  It  is,  in  its 
nature,  a  permanent  investment  for  the  water  continues  to  flow 
forever  and  only  the  hand  of  decay  touches  the  dams,  diversion 
works  and  water  and  electrical  conduits.  The  investor's  owner- 
ship of  money  is  transferred  to  representations  of  indebtedness. 
Under  the  law  above  quoted  from  the  right  to  use  this  plant,  and 
each  element  thereof,  except  the  water,  "may  be  revoked  by  him 
(the  Secretary  of  the  Interior)  or  his  successor  in  his  discretion." 

Will  the  prudent  investor  put  money  into  an  enterprise  the 
very  life  of  which,  so  far  as  he  is  concerned,  depends  wholly  upon 
the  will  of  a  Secretary  of  the  Interior?  The  answer  must  be,  No! 
The  lack  of  water  power  development  during  the  last  four  years 
so  demonstrates  and  also  that  the  law  of  1901,  born  of  federal 
control  of  a  few  acres  of  land,  has  blocked  the  progress  of  states 
and  prevented  the  conservation  of  their  resources. 

The  impotence  and  viciousness  of  this  law  being  realized,  a 
bill  "To  provide  for  the  development  of  water  power  and  the  use 
of  lands  in  relation  thereto  and  other  purposes"  (H.  R.  16,673) 
was  introduced  in  the  house  of  representatives,  May  19,  1914, 
there  passed,  and  is  now  before  the  senate  and  has  been  twice 
read  and  referred  to  the  committee  on  public  lands. 

The  question  of  interest  is:  If  this  bill  be  enacted  into  law, 
will  the  development  of  Western  water  powers  be  practical  under 
its  terms  ?  In  other  words :  Ought  prudent  investors  to  invest 
in  securities  issued  under  its  terms?  Will  such  investors  invest? 
If  these  questions  must  be  answered  in  the  negative,  then  the 
passage  of  the  bill  would  accomplish  no  useful  purpose. 

Stripped  of  verbiage,  the  important  provisions  of  the  bill  are: 

"That  the  public  domain  may  be  leased  for  the  purpose  of  the 
construction  and  operation  of  hydro-electric  plants  for  not  longer 
than  fifty  years,  but  such  lease  shall  not  be  assignable  or  trans- 
ferable without  the  written  consent  of  the  Secretary  of  the  Inte- 
rior. 

"That  such  plants  shall  be  continuously  operated  subject  to 
market  conditions,  and  an  excess  of  fifty  per  cent  of  its  output 
shall  not  be  contracted  to  any  one  consumer. 

"That  the  regulation  and  control  of  service  and  charges  and 


CONSERVATION  OF  WESTERN  POWER  RESOURCES    185 

the  issuance  of  stock  and  bonds  is  conferred  upon  the  Secretary 
of  the  Interior. 

'That  the  physical  combination  of  plants  may  be  permitted 
in  the  discretion  of  the  Secretary  of  the  Interior,  but  arrangements 
limiting  the  output  are  prohibited. 

"That  without  the  consent  of  the  Secretary  of  the  Interior 
no  sale  and  delivery  of  power  shall  be  made  to  distributing  com- 
panies, except  in  cases  of  emergency  and  then  only  for  a  period 
not  exceeding  thirty  days. 

"That  the  constructor  shall  create  no  lien  upon  the  plant  by 
mortgage  or  trust  deed,  except  such  as  is  approved  by  the  Secre- 
tary of  the  Interior. 

"That  after  forty-seven  years,  upon  three  year's  notice,  the 
United  States  shall  have  the  right  to  take  over  the  plant  upon 
paying  the  actual  cost  of  rights  of  way,  water  rights,  and  the 
interests  in  lands  of  which  the  lessee  is  the  actual  owner  and 
the  reasonable  value  of  the  property  erected  upon  the  leased  lands, 
such  reasonable  value  to  be  determined  by  agreement  betw'een  the 
Secretary  of  the  Interior  and  the  lessee  or  by  judgment  of  the 
United  States  court. 

"That  if,  upon  the  expiration  of  the  lease,  the  United  States 
does  not  take  over  the  plant,  or  does  not  renew'  the  lease,  the 
Secretary  of  the  Interior  may  sell  the  entire  property,  the  pur- 
chaser to  pay  the  lessee  upon  the  same  basis  the  United  States 
would  pay  if  it  took  over  the  property. 

"Contracts  for  the  sale  of  power  extending  beyond  the  life  of 
the  lease,  must  be  made  with  the  approval  of  the  Secretary  of  the 
Interior  and  when  so  made,  the  successor  in  interest  of  the  lessee 
assumes  the  obligation  thereof. 

"The  Secretary  of  the  Interior  may  specify  charges  and  col- 
lect charges  or  rentals  for  all  power  sold  and  used  and  not  neces- 
sary for  the  operation  of  the  plant,  said  charges  to  go  into  the 
reclamation  fund  heretofore  created  by  Act  of  Congress,  one-half 
thereof  to  come  back  to  the  state  when  certain  conditions  are  ful- 
filled. 

"In  states  where  the  regulation  of  rates  of  service  and  the 
issuance  of  stock  or  bonds  is  not  controlled  by  a  public  service 
commission  or  other  authority,  such  power  is  vested  in  the  Sec- 
retary of  the  Interior  or  other  body  authorized  by  congress. 


186  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

"The  power  to  examine  all  books  and  accounts  and  require 
the  submission  of  statements  and  reports  relating  to  the  business 
matters  of  the  lessee,  is  vested  in  the  Secretary  of  the  Interior. 

"That  rules  for  carrying  into  effect  the  provisions  of  the  Act 
shall  be  made  by  the  Secretary  of  the  Interior. 

"That  nothing  in  the  Act  shall  be  construed  as  affecting  or 
intending  to  affect,  or  in  any  way  to  interfere  with  the  laws  of 
any  state  relating  to  the  control,  appropriation,  use  or  distribution 
of  water." 

Will  the  investing  public — looking  at  the  matter  from  the 
standpoint  of  fairminded,  prudent,  business  men — advance  money 
for  the  construction  of  plants  and  transmission  lines  under  this 
Act?  The  answer  must  be,  No,  and  that  for  the  reason  that  they, 
or  their  representatives — from  a  practical  standpoint — have  no  real 
control  over  the  management  of  the  plant  their  money  constructs. 
Freed  from  chaff,  this  arrangement  means  that  the  constructors 
of  an  enterprise  turn  it  over  to  the  Secretary  of  the  Interior  to 
operate,  they  paying  operating  expenses  and  taking  whatever  profit 
the  management  of  the  Secretary  and  his  agents  may  earn,  if  any, 
not  exceeding  an  amount  to  be  fixed  by  the  Secretary,  or  stand 
such  loss  as  may  be  sustained,  as  the  case  may  be.  At  the  end 
of  fifty  years  the  lessee's  right  to  have  the  property  operated  ceases. 
No  assurance  is  given  that  the  lease  will  be  renewed,  nor  that  the 
United  States  will  take  the  property  and  make  the  lessee  w'hole 
under  the  terms  of  the  Act,  nor  that  the  United  States  will  be 
able  to  transfer  the  property  to  a  new  lessee  who  will  do  so. 

To  all  intents  and  purposes,  the  investor  is  a  silent  spectator 
in  the  grandstand,  while  the  Secretary  of  the  Interior  and  his 
agents  direct  the  men  the  investor  pays  for  the  administration  and 
manual  operation  of  the  plant  while  the  life  of  the  lease  rolls  by. 

In  view  of  the  conditions  imposed  upon  an  enterprise  and 
investment  which  can  only  be  quickened  into  life  by  falling  w'ater, 
of  which  a  sovereign  state,  or  its  grantees,  is  the  owner  of  the 
right  to  use,  the  provision  of  the  bill — which  we  quote  verbatim. 
viz: 

"That  nothing  in  this  Act  shall  be  construed  as  affecting  or 
intended  to  affect  or  to  in  any  way  interfere  with  the  laws  of  any 
state  relating  to  the  control,  appropriation,  use  or  distribution  of 
water." 


CONSERVATION  OF  WESTERN  POWER  RESOURCES    187 

— if  taken  seriously,  can  only  be  regarded  as  a  joke.  A  man 
holding  the  key  to  a  dungeon  might  as  well  invite  a  respected 
citizen  therein,  gag  him,  hogtie  him,  close  and  lock  the  door  and 
in  making  his  exit  say:  ''Nothing  I  have  done  shall  be  con- 
strued as  affecting  or  intending  to  affect  or  to  in  any  way  interfere 
with  your  personal  liberty  or  freedom  of  movement  under  the 
laws  of  your  state." 

If  the  bill  becomes  law  the  congress,  in  effect  will  assert  that 
the  Western  States  are  incapable  of  properly  directing  and  con- 
trolling their  domestic  affairs  insofar  as  the  development,  opera- 
tion and  business  conduct  of  hydro-electric  power  plants  is  con- 
cerned, therefore,  by  reason  of  federal  ownership  of  public  lands, 
valueless  in  themselves,  we  dictate  what  they  shall  do,  and  w'hat 
they  shall  not  do,  in  regard  to  such  matters,  and  appoint  the  Sec- 
retary of  the  Interior,  and  his  officers  and  agents,  their  guardian 
with  full  power  to  act  in  the  premises,  granting  him  full  authority 
to  make  such  rules  and  regulations  regarding  his  own  acts  and 
the  state's  grantees  as  he  sees  fit  and  proper  and  from  which  there 
shall  be  no  appeal. 

The  bill  is  impracticable  from  a  business  standpoint.  Local 
conditions  must  dominate  the  management  and  operation  of  a  busi- 
ness enterprise.  The  particular  character  of  the  enterprise  and 
its  environments  marks  out  certain  fixed  paths  along  which  its 
management  and  control  must  travel.  An  ideal  may  be  desired, 
but  the  ideal  cannot  be  created  by  fiat,  regulation  or  enactment, 
it  must  be  the  fruit  of  constructive  development.  Constructive  de- 
velopment cannot  be  guided  by  a  man  thousands  of  miles  away 
and  not  substantially  interested  in  the  results  obtained.  It  can 
only  be  guided  by  a  man  directly  behind  the  gun,  whose  heart  and 
soul  is  in  his  work,  and  directly  responsible  to  the  actual  parties 
in  interest,  not  only  for  successful  operation,  but  for  such  reason- 
able financial  success  as  returns  a  fair  profit  upon  the  investment. 
His  hours  cannot  be  fixed  by  the  hands  of  a  clock.  His  respon- 
sibility is  satisfied  only  by  an  all  around  success  and  the  reasons 
why  he  succeeds  or  fails  are  of  no  moment.  Such  responsibility 
and  efficiency  results  only  from  the  power  to  exercise  such  free 
hand  and  sound  discretion  as  the  facts  and  exigencies  of  the  par- 
ticular case  and  moment  demand. 

All  fair  minded  men  favor  true  conservation,  the  abolishment 
of  waste.  Therefore  they  must  favor  the  development  of  water 


188  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

powers  within  the  arid  states.  To  accomplish  this  the  three  factors 
in  interest  must  come  together  on  a  practical  plan  for  the  unifica- 
tion of  interests.  The  open  question  is,  can  the  minds  of  the 
parties  meet  on  a  plan  to  be  enacted  into  law  that  will  be  just 
and  fair  from  all  standpoints  and  at  the  same  time  practical?  It 
is  believed  they  can  and  the  elements  of  such  plan  are  few  and  not 
complex. 

The  investor's  money  must  be  secured  in  accordance  with  rec- 
ognized, sound  business  principles. 

The  direction  and  management  of  the  enterprise  must  be 
with  the  investor's  agents,  for  he  must  be  assured  at  all  times  that 
the  best  skill  of  the  day  is  properly  working  to  the  end  of  efficient 
operation  and  a  legitimate  return  upon  the  investment. 

Purchasers  of  product  must  be  on  a  substantial  equality  and 
insured  that  the  price  required  will  be  reasonable  and  not  greater 
than  necessary  to  return  compensation  and  a  fair  profit  upon  the 
investment. 

With  these  results  accomplished  it  cannot  be  material  who 
owns  the  plant,  unless  the  sovereign,  federal  or  state,  desires  to 
become  the  owner  as  a  matter  of  public  policy. 

All  desired  results  would  seem  accomplished  if  capitalization 
were  fixed  at  a  certain  ratio  of  cost;  if  the  service  cost  to  con- 
sumers was  regulated  by  state  public  service  commissions,  or,  in 
their  absence,  other  competent  authority;  if  the  sovereign,  after 
the  lapse  of  a  reasonable  number  of  years,  has  the  right  to  be- 
come the  owner  upon  payment  of  a  proper  and  just  valuation  and 
if  a  flat  charge  upon  the  output  as  rental  for  lands  occupied  but 
owned  by  the  United  States  is  paid,  if  such  charge  be  deemed  ad- 
visable. What  would  be  a  proper  and  just  value  of  the  entire 
property  upon  the  taking  over  by  the  sovereign  would  be  pre- 
sumptuous for  one  individual  to  say,  but  the  ripe  judgment  of 
men  skilled  in  the  fair  and  legitimate  investment  of  capital  would 
seem  to  be  the  potent  factor  determining  this  question  from  the 
practical  standpoint. 

The  matter  in  issue  is  but  an  economic,  business  proposition. 
There  is  a  point  where  the  minds  of  the  diverse  interests  ought 
to  meet,  where  rational  fairness  and  practicable  conditions  will 
inure  to  all.  With  this  point  reached  and  acted  upon  by  legisla- 
tion, progress  will  result,  otherwise  stagnation  and  waste  will  con- 


CONSERVATION  OF  WESTERN  POWER  RESOURCES    189 

tinue  and  the  so-called  policy  of  conservation  continue  to  be  a 
sham.  The  federal  government  may,  by  congressional  enactment, 
coerce  a  state  and  block  its  material  progress,  but  it  cannot  coerce 
the  private  investor. 

Power  to  the  value  of  millions  of  dollars  is  being  yearly 
dissipated  and  lost  in  the  Western  gulfs  and  oceans,  promising 
mineral  prospects  are  lying  idle,  and  thousands  of  acres  of  land 
are  now  desert  which  might  by  fruitful  and  productive  under  pump- 
ing irrigation.  To  permit  the  Western  water  power  resources  to 
lie  unused  is  to  permit  or  compel  an  annual,  inexcusable  and  im- 
provident waste  that  amounts  almost  to  a  devastation,  and  is  to 
maintain  a  condition  that,  from  a  humanitarian  standpoint  alone,  is 
intolerable  and  impolitic,  and  grave  indeed  is  the  responsibility  of 
those  who,  having  the  power  or  direction  within  their  hands,  permit 
or  compel  such  loss.  The  dictates  of  humanity  demand  that  living, 
existing  things  be  developed  out  of  such  idle  resources,  and  in  so 
doing  nothing  is  lost  to  future  generations  for  the  power  of  the 
water  in  its  fall  is  a  present,  living  and  existing  thing  throughout 
every  minute  and  second  of  present  years  and  coming  ages  as  long 
as  waters  flow  onward  to  the  sea,  and  "the  mill  will  never  grind 
with  the  waters  that  have  passed." 

It  is  believed  an  all  wise  Providence  intended  its  boundless 
resources,  for  the  time  imprisoned  in  the  falling  waters,  to  be 
conserved  and  applied  to  the  aid  of  man  in  ministering  to  his 
necessities  and  in  supplying  him  with  such  comforts  and  con- 
veniencies  and  as  the  intelligence  of  the  day  makes  practicable. 

It  is  believed  the  congress,  in  its  wisdom,  should  at  once  pro- 
vide that  the  respective  states,  through  their  citizens,  may  have,  on 
practical  terms  and  conditions,  just  and  fair  to  all  interests,  na- 
tional, state  and  private,  the  use  of  the  public  lands  to  the  extent 
necessary,  whereby  to  wrest  the  power  from  the  falling  waters 
and  thereby  upbuild  the  state  and  advance  the  good  of  human  kind 
during  the  present  and  future  generations. 

If  it  be  said  this  cannot  be  done  now,  can  it  be  done  in  the 
future  ? 

If  it  be  admitted  it  can  be  done  in  the  future,  w'hy  can  it  not 
be  done  now? 


Give  the  Miner  a  Square  Deal 

J.    C.    THORESEN, 
SALT   LAKE   CITY,   UTAH. 


Recently  a  miner  asked  me  why  the  farmer  was  given  so  many 
advantages  over  the  miner  in  securing  surveys  and  patents  from 
the  government,  for  his  land  claims.  Answering  the  question  him- 
self, he  said,  "It  is  because  farmers  make  the  land  law's." 

Taking  into  consideration  the  following  facts,  the  indications 
certainly  justify  this  miner  in  his  conclusions. 

Upon  the  application  of  the  farmer  the  government  surveys,  at 
its  own  expense,  the  land  he  desires  to  secure,  and  under  the  home- 
stead laws  it  gives  him,  practically  free  of  cost,  160  acres  of  land, 
his  own  choice,  if  he  but  resides  on  it  for  three  years;  or,  if  he 
chooses,  after  residing  on  it  for  fourteen  months,  he  can  secure 
title  by  the  payment  of  $1.25  per  acre.  In  certain  parts  of  the  West 
he  can  get  320  acres  by  merely  cultivating  certain  portions  of  it 
annually  for  three  years,  without  even  making  his  residence  thereon. 
Or  he  can  secure  320  acres  for  $1.25  per  acre  by  reclaiming  it  by 
artificial  irrigation. 

The  miner,  on  the  other  hand,  first  prospects  (perhaps  for 
years)  to  find  indications  of  mineral ;  he  then  stakes  off  his  claim 
of  20  acres,  makes  and  records  his  Location  Notice,  proceeds  to 
find  "mineral  in  place"  within  his  ground — and  in  the  not  distant 
past  it  had  to  be  "in  commercial  quantities" — complies  with  the 
local  and  general  mining  laws,  rules  and  regulations ;  he  must  ex- 
pend $500.00  in  development  work  on  his  claim  of  20  acres  before 
he  is  even  permitted  to  have  his  claim  officially  surveyed  at  his  own 
expense,  which  costs  him  upwards  of  another  $500.00 ;  he  must  pay 
the  government  $5.00  per  acre  for  his  ground  and,  if  all  these  re- 
quirements have  been  strictly  complied  with  and  so  certified  by  the 
agents  of  the  government,  a  patent  is  issued  to  him  for  his  claim. 
This  makes  his  ground  cost  him  in  the  neighborhood  of  $50.00  per 
acre,  besides  months  and  years  of  time  required  to  comply  with 
these  various  restrictions. 


GIVE    THE    MINER    A    SQUARE    DEAL  191 

If  the  farmer  fails  to  raise  a  crop  it  is  generally  his  own  fault, 
either  through  ignorance  or  carelessness ;  but  where  one  farmer 
fails  there  are  ninety-nine  miners  who  fail  "to  make  their  claims 
pay."  Hence,  the  miner's  chance  to  get  returns  from  his  labors 
and  investments  as  against  the  farmer's  is  I  to  99. 

Then  again,  the  land  the  miner  secures  is  generally  worthless, 
except  for  "one  crop" — the  mineral  it  may  contain — while  the 
farmer's  land  is  good  for  a  succession  and  variety  of  crops  and 
often  for  other  purposes.  If  the  farmer  fails  in  one,  he  may  suc- 
ceed in  another;  but  not  so  with  the  miner;  if  he  fails  in  finding 
mineral  in  commercial  quantities  and  qualities  (which,  if  at  all,  in 
nearly  every  case  is  after  extensive  expenditure  of  time  and  money 
in  prospecting  and  development,  besides  the  foregoing  outlay  of 
$1,000  for  surveys,  patents,  etc.),  all  his  efforts  are  a  total  loss. 

It  was  formerly  presumed  that  mining  was  very  profitable — a 
get-rich-quick  proposition — and  that  farming  was  slow  and  uncer- 
tain as  to  results,  especially  in  the  arid  west. 

But  time  and  experience  have  proven  just  the  opposite.  A 
farmer,  with  the  same  standard  of  knowledge  and  experience  in  his 
line  that  an  average  miner  has  in  his,  is  sure  to  succeed.  He  gets 
some  crop  each  year  and  his  claim  improves  continually  with  every 
dollar  expended  and  every  day's  work.  His  living  is  certain,  with 
much  less  capital  invested  than  the  miner  requires.  He  lives  in 
peace  with  his  family.  But  the  poor  miner  gets  no  returns  for  years 
—his  efforts  and  expenditures  often  prove  that  there  are  no  returns 
at  all  from  his  claim.  His  lonely  life  in  the  hills,  as  he  burrows 
into  the  mountain  through  a  small  prospector's  tunnel,  is  not  to  be 
compared  with  the  pleasant  life  of  the  farmer. 

Why  this  discrimination?  Is  it  not  a  fact  that  our  land  laws 
were  made  by  our  eastern  neighbors  w'ho  were  acquainted  only  with 
agricultural  pursuits,  and  had  but  a  slight  knowledge  of  mining? 
This  is  certainly  true  of  a  majority  of  members  of  past  congresses. 

Has  not  the  time  arrived  when  the  miner  should  receive  some 
consideration  and  be  put  upon  an  equal  footing  with  the  agricul- 
turist? Why  not  let  his  claim  be  surveyed  by  the  government 
without  expense  to  him,  and  give  him  title  for  $1.25  per  acre,  the 
same  as  to  the  farmer? 

Mining  claims  could  often  be  surveyed  by  the  U.  S.  surveyors 
in  their  regular  work  without  much  extra  expense,  and  in  such 


192  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

cases  the  miners  would  be  accorded  the  privilege  which  is  always 
extended  to  the  farmer.  Special  surveys  of  homesteads  are  being 
made  in  forest  reserves  for  the  farmer  or  squatter,  at  the  sole  ex- 
pense of  the  government,  but  the  miner's  claim  is  "passed  up." 

The  West  is  now  much  better  understood.  It  has  many  able 
representatives  in  Congress  and  in  the  various  departments  of  the 
Federal  Government,  and  I  am  certain  all  will  join  in  securing  this 
great  boon  and  "square  deal"  for  the  mineral  development  of  our 
country. 

Our  government  expends  vast  sums  in  the  aid  of  agriculture 
in  a  thousand  different  ways,  which  is  very  commendable,  but  a 
very  limited  amount  is  appropriated  for  the  development  of  the 
mineral  resources  of  our  country. 

The  world  is  eagerly  demanding  our  gold,  silver,  and  other 
minerals.  We  have  them  in  unbounded  quantities,  with  plenty  of 
men  and  means  to  bring  them  out,  if  only  a  little  encouragement 
be  given  by  the  government. 

Let  us  give  the   miner  a  chance! 


E  Pluribus  Unum 

BY   EDWARD    G.    REINERT, 
DENVER,    COLORADO. 

Not  long  ago  the  newspapers  published  a  list  of  worthless 
stocks,  bonds  and  loans  which  had  .been  left  in  the  strong  boxes 
of  E.  H.  Harriman,  Jay  Gould  and  Russell  Sage  when  they  died. 
In  each  case  the  exhibit  showed  a  preponderance  of  losses  in  wild- 
cat railroad  investments.  The  mining  stocks  held  by  these  million- 
aires represented  only  an  insignificant  share  of  their  unsatisfactory 
purchases. 

Elaborate  lists  of  obsolete  securities  have  been  published  and 
are  available  to  those  who  desire  to  investigate.  Mining,  which  in 
these  days  is  so  often  accused  of  all  the  crimes  of  promotion,  to 
the  exclusion  of  other  industries,  represents  so  small  a  part  of  the 
unhappy  ambitions  of  investors  that  it  should  not  be  considered 
in  any  discussion  of  unwise  investments.  Smythe's  handbook  of 
"Obsolete  American  Securities  and  Corporations"  sets  forth  twenty 
pages  of  "First  National"  banks  that  have  failed  or  suspended 
business  in  the  United  States.  The  frequent  repetition  of  that  one 
designation  is  sufficient  evidence  that  the  banking  business  itself 
is  not  the  safest  opportunity  for  capital.  Thirty  years  ago  a  writer 
in  the  North  American  Review  pointed  out  that  eleven  eastern  and 
southern  states  had  repudiated  bonds  to  the  amount  of  $310,000,000. 

But  it  is  not  my  purpose  to  indulge  in  invidious  comparisons. 
Men  are  very  much  the  same  in  all  ranks,  professions  and  climates. 
It  is  only  because  the  mining  industry  is  so  frequently  put  upon  the 
defensive  in  respect  to  its  financial  methods  that  we  sometimes 
find  it  necessary  to  study  investment  systems  in  general  and  touch 
up  the  history  of  those  industrial  enterprises  in  which  our  Eastern 
critics  live  and  move  and  have  their  being.  Mine  promotion  has 
repeated,  on  a  very  small  scale  only,  the  tendencies  that  have  ap- 
peared in  connection  with  all  industrial  progress.  We  puff  and 
spout  in  vain  when  we  discourse  upon  plans  to  "get  rid  of  the 
faker"  and  "elevate  the  promotion  business."  After  years  of  in- 
timate contact  with  movements  to  purify  finance,  I  have  come  to 


194  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

the  conclusion  that  counterfeiters  and  imposters,  like  the  innocent 
and  gullible,  are  an  inherent  element  in  our  social  constitution ; 
it  cannot  be  removed,  but  may  perhaps  be  neutralized.  In  any 
event,  the  seamy  side  of  business  should  not  be  permitted  to  darken 
our  constructive  efforts.  Men  of  good  intentions  are  the  rule,  not 
the  exception ;  if  this  were  not  so,  there  would  be  no  progress. 

What  I  desire  to  offer  is  a  few  broad  historical  reflections  upon 
the  business  of  investment,  to  the  end  of  bringing  our  conclusions 
to  bear  upon  the  current  problems  of  mining  finance.  Let  us  put 
aside  the  critical  for  the  scientific  attitude. 

(1)  The  word  investment  was  invented  to  describe  a  process 
by  which  surplus  wealth,  or  capital,  seeks  to   reproduce  and  in- 
crease   itself   through    the   organization   and    construction    of   the 
means  of  producing  more  wealth.    This  definition  reveals  the  mo- 
tive  force   of  modern  industry.     But  the  constructive  power   of 
capital  is  not  unlimited,  because  its  motive  may  be  curtailed  by  the 
restriction  of  those  market  outlets  for  its  produce  which  are  the 
means  of  keeping  capital  fluid ;  capital  can  only  function  as  a  con- 
structive agent  in  industry  through  the  sales  of  the  commodities 
which  it  reproduces.    To  put  the  matter  more  simply,  when  a  given 
people  has  all  the  steel  works  that  it  needs,  'twere  folly  to  build 
more,  for  no  one  has  yet  discovered  a  market  for  steel  products  on 
the  Moon.    When  we  have  enough  steel  factories  to  supply  all  the 
materials  of  this  character  that  the  people  of  the  world  can  pos- 
sibly use,  investment  in  new'  steel  factories  will  become     a  risky 
proceeding.     Moreover,  when  the  ownership  of  steel  factories  be- 
comes highly  concentrated,  conduct  and  market  systematized  and 
their  management  unified,  it  becomes  increasingly  difficult  to  pro- 
mote and  finance  new  institutions  of  this  character.    The  man  who, 
in  the  face  of  this  inevitable  situation,  seeks  to  promote  a  steel 
factory  is  a  faker,  because,  if  he  has  any  brains  and  education,  he 
must  know  that  he  cannot  make  good.    He  is  not  a  faker  because 
steel  factories  are  bad  things,  but  because  more  steel  factories  will 
be  a  loss  and  a  nuisance.     Investment  in  the  manufacture  of  steel 
becomes  henceforth  a  process  of  financing  improvements  and  ex- 
tensions to  that  which  already  exists  as  a  foundation.     I  am  not 
here  seeking  to  air  personal  opinions,  but  merely  to  utter  a  his- 
torical  judgment. 

(2)  Every  civilization  experiences  the  constructive  power  of 
capital   through   a  certain   order  of  development,  beginning  with 


E    PLURIBUS    UNUM  195 

the  smallest  conceivable  units  of  organization  and  ending  with  the 
largest.  The  industrial  form  becomes  fixed  and  we  encounter 
thereat  an  inevitable  economic  resistence  to  invention  and  promo- 
tion. That  invention  or  promotion  must  be  overpowering  and  revo- 
lutionary which  can  hope  to  contest  the  field  already  won  by  a 
standard  invention  or  held  by  a  gigantic  organization  of  capital 
greater  than  any  mass  of  new  capital  that  can  be  brought  against 
it.  At  no  previous  period  in  the  recorded  history  of  the  world  have 
we  known  of  any  people  possessing  the  accumulations  of  wealth 
and  the  means  of  wealth  production,  based  upon  highly  technical 
knowledge  and  science,  which  are  now  visible  in  Europe  and  the 
United  States.  Nevertheless,  we  find  the  parable  of  these  very 
things  in  the  story  of  Rome ;  a  despotic  attitude  toward  the  pos- 
sessors and  non-possessors  of  wealth  developed  with  the  cen- 
tralization of  capital  in  the  imperial  state.  We  are  repeating  today 
on  a  gigantic  scale  the  history  of  the  days  of  the  first  Caesar.  If 
the  great  Dictator  were  living  in  America  today,  he  would  be  a 
state's  rights  Republican.  Caesar  would  have  been  a  decentralizer. 
in  contrast  with  our  own  beloved  and  behated  Theodore  Roosevelt. 
Caesar  desired  to  enfranchise  the  people  of  Gaul  and  other  outlying- 
provinces,  as  a  means  of  saving  the  nation.  Mr.  Roosevelt  and  his 
school  are  yearning  to  disenfranchise  the  people  of  the  West  by 
means  of  a  federal  land-leasing  policy. 

(3)  During  the  period  of  independent  constructive  effort, 
capital  is  apt  to  be  loosely  and  recklessly  managed  and  the  returns 
from  successful  creativeness  are  large.  The  making  of  new  for- 
tunes is  rapid  and  the  financing  of  alluring  dreams  is  often  scan- 
dalously conducted.  Because  the  chances  are  great,  the  spirit  of 
speculative  embarkations  is  correspondingly  rampant.  The  pioneer 
in  industrial  finance  is  as  daring  as  the  pioneer  of  a  new  continent. 
The  resources  and  opportunities  both  of  nature  and  of  social  de- 
velopment enrich  both  the  purse  and  the  imagination.  This  is  the 
get-rich-quick  era  of  a  country's  history.  Presently  it  passes 
away,  and  new  ideals  develop.  The  g-0f-rich-quick  of  the  former 
day  become  conservative,  or  at  least  bestow  conservatism  upon 
their  sons.  The  father  who  has  accumulated  a  rapid  fortune  by 
fur-trading  with  the  Indians  leaves  an  heir  who  loans  money  at 
4/J  per  cent.  An  aristocracy  of  investment  arises.  To  get  rich 
quick  becomes  a  scandal ;  building  a  new  steel  factory,  when  none 
is  needed,  is  an  abomination  before  the  Lord.  Feudal  exclusivenes? 


196  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

frowns  down  upon  the  man  with  a  new  idea.  The  railroad  wild- 
catter is  succeeded  by  the  president  of  a  transportation  company 
kneeling  suppliant  before  the  throne  of  the  Interstate  Commerce 
Commission.  Try  to  build  a  new  railroad  from  Chicago  to  Denver, 
and  see  what  the  government  will  do  to  you.  Try  to  sell  a  stock 
or  bond  in  Kansas,  and  learn  what  a  "blue-sky"  commission  is 
made  for. 

(4)  The  sign  on  the  American  silver  dollar  is  E  pluribus 
uniwn.     That  means  that  we  are  one  country  composed  of  many 
states.    Since  the  fabrication  of  this  strange  device,  we  have  added 
many  more.     We  of  the  West  are  the  outlanders  of  the  original 
nation.     In  the  main,  the  states  of  the  great  Rocky  mountain  re- 
gion have  been  settled  since  the  Civil  war.    We  are  a  distinctive 
division  of  the  United  States,  possessed  still  of  the  pioneering  in- 
stinct, a  little  rude  in  our  manners  perhaps,  but  certain  of  our  right 
to  develop  ourselves  as  our  grandfathers  did  in  Pennsylvania  and 
Illinois.     Of  what  import  is  it  to  us  that  our  cousins  of  the  East 
are  willing  to  accept  a  state  of  industrial  fixity  and  insist  upon  a 
rigorous  notion   of  investment?     The  West  has  many   resources 
and  opportunities  both  of  nature  and  of  social  development ;  it  will 
reason  and  act  according  to  its  own  historical  perspective,  not  ac- 
cording to  the  historical  perspective  of  an  older  order.     On  the 
other  hand,  the  old  order  of  the  East  finds  occasion  to  ridicule 
mining  investments  because  it  is  mining  that  typifies  that  stage  of 
development  at  w'hich  the  West  has  thus-far  arrived.    There  exists 
a  provincial  antagonism  which  springs  from  a  historical  opposition 
between  the  old  and  the  new,  between  the  fixed  and  the  unsettled, 
between  the  imperialistic  and  the  republican  ideal.     In  spirit,  but 
not  in  form  nor  in  law,  the  West  is  a  different  nation  from  the 
East;  from  the  point  of  view  of  the  citizen  of  Denver,  New  York 
City  is  a  foreign  metropolis. 

(5)  Whatever  strain  may  exist,  as  between  the  view's  of  the 
East  and  the  views  of  the  West  upon  questions  of  investment, 
finance,  politics  and  the  administration  of  national  affairs,  reflects 
the  differences  of  social  and  industrial  development.     The  West 
is  still  in  the  midst  of  the  constructive  period ;  the  East  has  passed 
it  and  is  now  in  the  period  of  recrudescence.    The  West  understands 
the  East,  but  the  East  does  not  understand  the  West.     The  weak 
by  force  of  circumstances  understand  the  strong,  but  the  strong 
have  no  time  to  understand  the  weak.    It  is  no  unusual  occurrence 


B    PLURIBUS    UNUM  197 

in  history  that  the  institutions  of  a  new  civilization  may  cast  their 
influence  backward  over  the  peoples  that  have  been  left  behind 
them  in  the  race  around  the  world.  A  free  United  States  sent  her 
lessons  to  England  and  France;  ultimately  the  West  will  teach  the 
people  of  the  East.  It  is  no  mere  accidental  phenomenon,  for  ex- 
ample, that  nearly  all  the  trans-Missouri  states  have  adopted 
woman's  suffrage  as  an  expression  of  their  human  superiority 
over  the  older  commonwealths.  The  West  is  a  land  of  develop- 
ment. In  how  many  respects  do  we  find  that  development  ham- 
pered by  the  ignorant  or  invidious  power  which  the  West  must 
suffer  from  the  imperial  autocrats  of  the  old  United  States?  Let 
us  mention  a  few  instances : 

(a)  Our  public  lands  are  held  in  restraint  of  settlement  be- 
cause it  is  the  wish  of  a  people  not  ourselves  that  these  lands  should 
pay  tribute  to  the  "mother  country." 

(b)  So-called  "investment  bankers"  of  New  York,  Philadel- 
phia and  Chicago  seek  to  provide  a  system  of  commissionershipS' 
in  the  various  eastern  states  to  prevent  Western  enterprises  from 
seeking  capital  in  their  territory.     "Biy-sky"  legislation  is  another 
of  those  autocratic  devices  designed  to  defeat  the  decentralization 
of  investment. 

(c)  The  editors  of   Magazine  Row   habitually  assert  their 
want  of  understanding  by  co-operating  with  the  autocratic  agents 
to  influence  public  sentiment  against  the  interests  of  the  West.  Min- 
ing has  been  repeatedly  and  skillfully  lied  about  in  the  New  York 
press,  while  the  public  land  question  has  been  so  insidiously  mis- 
represented that  it  is  impossible  to  discover  a  fair  opinion  concern- 
ing it  among  the  Eastern  people. 

(d)  As  if  to  neutralize  the  avowed  purpose  of  the  new  cur- 
rency law,  so  far  as  the  Rocky  mountain  states  are  concerned,  the 
administrators  of  that  law  have  arranged  to  leave  one-half  of  the 
area  of  the  United  States  without  any  of  the  twelve  regional  banks. 
Between  Kansas  City  and  San  Francisco,  we  do  not  find  one  of 
these   federal   institutions.     This  neglect  is  a  most   palpable  dis- 
crimination against  the  great  Rocky  mountain  region,  whose  na- 
tional banking  connections  will  thus  be  found  either  in  a  corn  belt,  a 
cotton  belt  or  an  oriental  shipping  belt  on  the  Pacific  coast. 

(e)  In  the  matter  of  industrial  protection  against  the  com- 
petition of  the  old  United  States,  the  West  is  without  power  to 


198  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

regulate  the  railway  freight  rates  which  should  normally  be  used 
as  a  substitute  for  tariff  duties  in  encouraging  our  infant  manu- 
factures. Rate  changes  are  controlled  by  a  federal  commission 
which  has  its  seat  in  the  towers  of  the  mighty.  The  autocratic 
power  which  it  possesses  is  a  power  over  which  the  states  of  the 
West  have  no  voice.  Ontario  and  Quebec  and  western  Canada 
can  erect  a  tariff  wall  against  New  York  and  Pennsylvania,  but 
Colorado  and  Arizona  and  Utah  cannot  do  so,  because  we  belong 
to  the  e  pluribus  unum,  so  carefully  guarded  by  the  constitution. 
The  arbitrament  of  w'estern  freight  rates  is  also  denied  to  us  by 
the  political  supremacy  of  our  entrenched  competitors. 

This  is  the  situation.  I  have  sought  to  present  a  social  and 
historical  moving  picture  of  those  principles  and  events  which 
must  govern  any  inquiry  into  western  questions.  The  deliberations 
of  the  American  Mining  Congress,  insofar  as  they  relate  to  the 
express  interests  of  the  West,  cannot  escape  conformity  with  the 
political  facts  which  have  been  briefly  sketched  out  in  the  foregoing 
pages.  The  West  is  rapidly  approaching  a  crisis  in  its  relationships 
with  the  East  and  in  its  political  status  under  a  federal  system. 

But  I  pass  that  by,  because  the  further  discussion  of  it  does 
not  fall  within  the  province  of  this  address.  That  in  which  we  are 
vitally  interested  is  the  problem  of  finance  as  it  relates  to  western 
industries,  notably  mining.  The  business  of  enlisting  capital  for 
the  development  of  new'  areas  in  a  relatively  young  division  of 
country  encounters  many  untoward  experiences  and  difficulties. 
Dishonest  promotion  is,  of  course,  a  hurtful  thing ;  government  in- 
terference is  far  more  hurtful.  The  tendency  toward  which  we  must 
look  with  the  greatest  favor  is  the  investment  of  western  capital  in 
the  West.  Whenever  a  dividend  is  paid  by  a  mine,  it  were  far 
better  for  us  if  it  fell  into  the  pocket  of  a  western  man.  Too  little 
effort  is  expended  in  keeping  our  business  opportunities  at  home. 
To  do  this  is  to  assert  in  some  degree  our  financial  independence 
of  the  "mother  country."  I  have  pointed  out  that  the  worthless 
securities  left  behind  by  Harriman,  Gould  and  Sage  represented 
a  great  many  wild-cat  railroad  stocks  and  bonds.  Let  it  be  said  of 
our  western  millionaires  that,  when  they  died,  their  estates  showed 
that  they  had  dealt  lavishly  in  mining  ventures. 

In  a  very  literal  sense,  mining  is  a  peculiar  business.  Per- 
haps we  should  not  expect  the  citizens  of  Vermont  and  Indiana 
to  understand  it.  We  have  much  to  gain  by  educating  our  own 


E    PLURIBUS    UNUM  199 

people  in  the  habit  of  developing  their  own  mineral  resources,  in- 
stead of  trading  in  Wall  Street.  As  western  people,  we  do  not  have 
to  contend  with  them  in  the  matters  of  sectional  and  historical  dif- 
ference which  exist  between  ourselves  and  our  Eastern  cousins. 
I  believe,  therefore,  that  a  proper  and  important  question  for  the 
American  Mining  Congress  to  take  up  is  that  of  promoting  the  in- 
terest of  the  West  in  the  West.  Let  it  turn  aside  from  the  task  of 
protecting  Eastern  investors  long  enough  to  inquire  about  the  pro- 
tection of  western  investments  from  the  people  of  the  East. 

It  will  not  do  to  attempt  to  suppress  the  ideas  of  speculative 
profit  to  be  secured  from  the  development  of  the  West.  The  specu- 
lative incentive,  which  prevails  in  the  early  years  of  a  country's 
progress,  must  apply  to  the  newer  regions  of  the  United  States  as 
though  they  were  under  a  separate  government.  If  the  time  has 
arrived  when  the  people  of  the  East  look  upon  investment  as  a  4^ 
per  cent  proposition,  we  must  protest  against  the  extension  of  such 
notions  to  the  West.  Western  development  calls  for  that  rampant 
individualism,  the  same  old  notions  of  freedom,  which  have  made 
every  new  country  possible. 

Conservationism  is  only  one  manifestation  of  the  imperial  de- 
sire to  prevent  speculation  in  the  opportunities  of  an  undeveloped 
region.  No  new  fortunes  are  to  be  tolerated  by  men  of  the  Pin- 
chot  type,  who  have  already  accumulated  theirs.  That  is  the  es- 
sence of  conservationism.  It  is  matched  in  a  way  by  the  "blue- 
sky"  movement  such  as  the  "investment  bankers"  of  the  imperial 
metropolis  have  seen  fit  to  define  it:  a  movement  to  restrict  invest- 
ment to  the  new  securities  of  the  great  railroad  and  industrial  com- 
binations whose  management  is  centered  in  New  York  City.  Mining 
is  not  a  4^  per  cent  proposition.  It  is  based  on  nothing  less  than 
a  20  per  cent  ideal ;  that  is  the  way  new'  commonwealths  are  built. 

The  day  of  imagination  has  passed  in  the  East;  it  still  abides 
in  the  West.  With  us  there  is  still  room  for  Napoleons,  if  their 
opportunity  is  not  sapped  by  the  tyranny  of  the  old  United  States. 
In  the  language  of  a  Colorado  poet : 

"The  West  is  the  promise;  the  East,  the  regret. 


Acetylene  Mine  Lighting 

BY    A.    CRESSY    MORRISON, 
NEW    YORK    CITY. 


The  history  of  the  introduction  of  acetylene  into  the  mines  of 
the  world  by  means  of  what  is  known  as  the  carbide  lamp  is  re- 
markable for  its  brevity,  and  the  general  acceptance  of  the  new 
light  has  been  startling  in  its  rapidity.  Acetylene  in  the  mine 
represents  a  paradox,  in  that  it  has  given  the  miner  a  better  light 
for  less  money.  Usually,  improved  means  cost  more  money  than 
an  old  method,  but  with  acetylene  mine  lighting,  the  economic 
argument  in  favor  of  the  illuminant  continues  after  several  years 
of  practical  experience  and  in  the  face  of  radical  reductions  in  the 
price  of  the  competing  sources  of  light.  The  use  of  acetylene  in 
mines  became  almost  universal  in  Europe  before  it  had  fairly 
started  here  and  the  first  two  or  three  years  in  America  were 
rather  difficult,  because  a  lamp  adapted  to  American  needs  had  to 
be  developed  and  the  miner  himself  had  to  be  taught  how  to  use 
the  lamp  successfully.  The  carbide  lamp  is  peculiarly  well  adapted 
to  use  as  a  cap  light,  and  in  the  coal  mines  of  the  country  the  cap 
light  is  almost  universal.  In  the  metal  mines,  both  the  cap  and  the 
hand  lamp  are  in  use.  Acetylene  is  equally  well  adapted  to  either 
form.  Up  to  the  present  time  no  safety  lamp,  using  acetylene  as 
a  source  of  illumination,  has  been  introduced  for  gaseous  mines,  but 
in  non-gaseous  coal  mines  it  is  safe  to  say  that  70  per  cent  of  the 
miners  are  now  carrying  acetylene  lights.  The  introduction  of 
acetylene  into  the  mines  was  resisted  rather  surprisingly,  for  it 
was  seen  by  all  parties  at  interest  that  its  widespread  use  would 
upset  long  established  trade  relations.  Then  again,  the  carbide 
lamp  was  forced  to  face  the  conservatism  which  is  innate  in  human 
nature.  The  very  fact  that  it  was  cheaper  and  also  better  seemed 
illogical  and  many  held  aloof.  Once  introduced,  however,  the 
carbide  lamp  won  its  way  straight  to  the  heart  of  the  miners 
themselves,  who  soon  learned  that  it  was  the  greatest  improvement 
in  illumination  since  the  abandonment  of  the  tallow  dip  and  the 
introduction  of  oils  and  waxes. 


ACETYLENE    MINE    LIGHTING  201 

In  enumerating  briefly  the  advantages  derived  from  the  use 
of  acetylene  in  mines,  safety  should  be  placed  first.  This,  of  course, 
includes  health. 

A  systematic  review'  of  the  use  of  an  illuminant  must  neces- 
sarily begin  with  its  source.  In  the  case  of  the  carbide  lamp,  this 
source  is  calcium  carbide.  Calcium  carbide  is  made  in  an  electric 
furnace  at  a  temperature  of  7,000  degrees  F.  It  has  all  the  char- 
acteristics of  crushed  stone  except  when  brought  in  contact  wifh 
water.  The  ingots  of  carbide  which  come  from  the  electric  fur- 
nace are  crushed  in  a  stone  crusher  to  various  sizes,  packed  in  air- 
tight metal  drums  and  shipped  ready  for  use.  The  carbide  is  not 
an  explosive;  it  is  not  affected  by  concussion;  it  cannot  be  burned 
and  the  lumps  could  be  placed  in  a  fire  without  the  fire  having  any 
effect  upon  them.  The  drums  are  air  and  water-tight  and  will 
stand  very  considerable  rough  usage  without  rupture.  When  car- 
bide is  brought  into  use  in  the  carbide  lamp,  the  quantity  of  car- 
bide for  a  cap  lamp  contains  about  one-half  a  foot  of  gas.  The 
total  amount  for  a  miner's  supply  for  a  day  is  therefore  but  a  few' 
ounces  and  if  it  should  all  produce  acetylene  at  once,  it  would 
yield  about  two  to  two  and  a  half  cubic  feet.  This  amount  is  so 
small  that  up  to  the  present  time  it  has  not  been  known  to  cause 
any  serious  trouble  under  any  conditions.  Carbide  will  not  give 
off  its  gas  fast  enough  under  ordinary  mining  conditions  to  become 
ignited  unless  it  comes  in  contact  with  actual  water.  The  moisture 
in  mine  air  will  slowly  slack  the  carbide,  but  not  fast  enough  to 
make  an  ignitable  mixture,  and  there  has  never  been  any  trouble 
from  this  cause  anywhere.  There  have  been  one  or  two  cases 
where  a  miner  with  a  light  on  his  cap  has  spit  into  the  carbide 
holder  of  another  lamp  and  produced  a  little  gas,  which  igniting 
from  his  cap  has  caused  a  flash.  The  answer  to  this  is  that  a 
miner  should  not  spit  into  his  carbide.  A  case  is  known  of  a  miner 
carrying  his  supply  of  carbide  in  a  glass  jar,  dropped  it  into  a 
puddle  of  water  and  then  stooping  down  with  his  lighted  lamp 
to  gather  up  the  carbide  and  save  it.  This  would  result  in  an 
ignition  of  the  gas  that  was  being  made  and  a  flash  more  startling 
than  hazardous.  Calcium  carbide  should  not  be  carried  into  the 
mines  in  glass  jars  but  always  in  a  tin  container. 

Calcium  carbide  has  not  proved  to  be  hazardous  under  any 
conditions  of  mine  practice.  There  is  no  reason  for  storing  large 
quantities  in  any  part  of  a  mine  and  no  hazard  could  arise  from 


202  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

so  storing  except  in  the  case  of  a  flood,  in  which  event  the  water- 
proof drums  would  hold  back  the  water  for  an  undetermined 
period.  Ninety-nine  drums  of  carbide  sunk  with  a  steamer  in  New 
York  harbor  this  year.  After  remaining  under  water  for  six 
weeks,  they  were  recovered  intact ;  not  one  of  them  had  yielded ; 
they  were  repainted  under  the  eyes  of  the  insurance  inspectors  and 
shipped  to  destination  in  perfect  condition. 

The  residue  from  calcium  carbide  is  merely  ordinary  slacked 
lime.  The  odor  from  the  residue  comes  from  slight  impurities  and 
has  no  effect  whatever  upon  man  or  animals. 

Acetylene  itself  is  a  rich  hydro-carbon  gas  having  the  same 
general  characteristics  as  any  other  gas  which  is  inflammable ;  that 
is,  it  is  inflammable  and  when  burned,  it  will  give  light  and  heat. 
It  obeys  the  same  laws  in  the  same  way  as  city  gas,  except  for 
certain  individualities  which  I  will  now  enumerate.  City  gas  con- 
tains carbon  monoxide.  A  very  small  percentage  of  this  in  the 
air  is  sufficient  to  cause  asphyxiation  and  death.  Acetylene  is 
entirely  free  from  this  deadly  gas.  Exhaustive  tests  have  been 
made  upon  man  and  animals  and  it  has  been  found  that  acetylene 
is  not  poisonous.  Any  gas  or  combination  of  gases  lacking  oxygen 
as  an  element  will  of  course  cause  death  by  suffocation  and  in 
this  sense,  anyone  who  walked  into  an  atmosphere  of  actylene  so 
rich  that  the  air  was  excluded  would  of  course  be  suffocated,  as 
though  walking  into  black  damp.  No  such  accumulation  can  occur 
in  mine  practice,  however.  There  is  therefore,  no  danger  from 
acetylene  in  mines  as  there  is  no  opportunity  whatever  for  any 
volume  of  the  gas  to  be  released.  The  odor  of  the  gas  which  is 
pungent  will  also  be  quite  apparent  when  the  percentage  of  acety- 
lene is  as  low  as  one  part  in  ten  thousand.  When  acetylene 
burns,  it  gives  off  as  a  product  of  combustion  carbon  dioxide  and 
water  vapor,  the  amount  given  off  being  about  one-tenth  as  much 
as  is  given  off  by  a  city  gas  burner  and  very  much  less  of  the 
same  combustion  products  than  are  given  off  by  any  of  the  other 
illuminants  such  as  oils,  waxes  or  candles,  generally  used  in  mines. 
One  great  advantage  of  acetylene  is  the  fact  that  it  burns  without 
smoke  or  soot  whereas  the  other  illuminants  used  in  mines  give 
off  varying  and  sometimes  very  large  quantities  of  smoke.  Acety- 
lene in  burning  uses  less  oxygen  than  other  illuminants  and  there- 
fore the  air  becomes  less  vitiated.  The  absence  of  smoke  brings 
into  play  for  acetylene  another  factor,  that  is  the  reflector,  which 


ACETYLENE    MINE    LIGHTING  203 

is  of  great  importance  and  which  increases  the  useful  candle  power 
of  the  acetylene  flame  from  10  to  30  times.  While  the  candle 
power  of  acetylene  without  reflector  is  in  excess  of  the  candle 
power  given  off  by  an  oil  flame,  the  use  of  a  reflector  which  throw's 
all  the  light  at  the  point  of  use,  multiplies  the  candle  power  so 
that  twenty  candle  power  at  the  working  face  is  easily  attained 
and  this  is  anywhere  from  ten  to  twenty  times  as  much  as  is 
given  off  by  the  oil  flame.  The  advantages  of  this  concentrated 
light  are  generally  recognized  and  are  so  marked  that  it  largely 
increases  working  efficiency.  Acetylene  gives  a  steady  light  all 
day  without  much  flicker  and  the  absence  of  smoke  makes  the  light 
effective  till  the  last  moment  of  work.  An  examination  of  the 
spectrum  of  acetylene  discloses  the  fact  that  it  is  the  closest 
approach  to  sunlight  of  any  of  the  illuminants.  No  artificial  light 
is  a  very  close  approximation  of  daylight  or  sunlight  but  acety- 
lene is  the  nearest  approach  and  therefore  is  nearest  in  harmony 
with  the  requirement  of  the  human  eye,  which  has  been  developed 
to  see  best  by  daylight.  There  can,  therefore,  be  no  eye  strain  or 
injurious  effect  upon  the  eye.  All  these  considerations  seem  to 
make  acetylene  ideal  from  the  chemical,  physiological  and  optical 
standpoint. 

The  question  of  the  action  of  the  acetylene  flame  in  the  pres- 
ence of  gases  naturally  found  in  mines  has  led  to  considerable  dis- 
cussion. As  a  preliminary  statement,  it  should  be  said  that  acety- 
lene should  not  be  used  in  any  mine  where  safety  lamps  are  prop- 
erly required  but  wherever  open  flame  lamps  are  used,  acetylene 
has  its  place.  No  question  has  been  raised  regarding  the  use  of 
acetylene  in  the  presence  of  any  of  the  gases  except  black  damp 
and  here  it  has  been  stated  that  acetylene  will  burn  in  an  atmo- 
sphere of  black  damp  in  which  man  cannot  exist.  Most  careful 
investigations  have  been  made  on  this  point  and  the  study  has  led 
to  a  more  definite  definition  of  black  damp.  Owing  to  the  expres- 
sion, in  which  might  be  called  practical  language,  of  the  chemical 
facts  regarding  black  damp,  there  has  arisen  a  misapprehension  as 
to  what  black  damp  really  is,  and  many  miners,  mine  superintend- 
ents and  even  mining  engineers  have  been  led  into  the  erroneous 
belief  that  black  damp  is  carbon  dioxide.  Under  abnormal  con- 
ditions black  damp  might  consist  of  nitrogen  and  a  large  percent- 
age of  carbon  dioxide,  but  under  practical  conditions  black  damp 
is  a  mixture  of  carbon  dioxide  with  various  proportions  of  nitrogen, 


204  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

seldom  exceeding  the  ratio  of  one  carbon  dioxide  to  four  nitro- 
gen, this  being  the  ratio  of  combustion.  Complete  slow  combustion 
changes  the  oxygen  into  carbon  dioxide  without  increasing  the 
volume.  The  carbon  dioxide  simply  replaces  the  oxygen.  How- 
ever, black  damp  is  seldom  as  rich  in  carbon  dioxide  as  this  for 
various  reasons.  Therefore,  when  black  damp  is  found  in  a  mine, 
it  must  be  considered  as  a  mixture  of  nitrogen  and  carbon  dioxide. 
Nitrogen  is  inert  as  regard  to  the  human  system,  but  carbon  diox- 
ide has  a  physiological  effect  which  in  fairly  large  quantities  may 
resemble  the  effect  of  a  narcotic.  Carbon  dioxide  also  has  an 
effect  on  flame  extinction.  A  series  of  experiments  conducted  under 
proper  conditions  has  disclosed  the  fact  that  neither  oil,  candles, 
acteylene  or  in  fact  any  flame  illuminant  is  an  adequate  protection 
against  pure  carbon  dioxide.  All  the  authorities  seem  to  agree 
that  3  or  4  per  cent  of  carbon  dioxide  will  cause  panting  and  that 
6  or  7  per  cent  soon  becomes  unbearable.  An  analysis  of  black 
damp,  however,  usually  show's  that  the  percentage  of  carbon  dioxide 
in  mine  air  where  black  damp  is  present  seldom  reaches  the  serious 
danger  point,  and  if  it  reaches  the  danger  point,  it  is  usually 
accompanied  with  sufficient  nitrogen  so  that  other  factors  are 
brought  into  play.  Open  flame  lamps  give  adequate  warning  of 
black  damp  and  acetylene  is  no  exception.  While  it  is  not  physio- 
logically advisable  for  men  to  work  in  the  presence  of  black  damp, 
the  presence  of  sufficient  quantities  of  black  damp  to  extinguish 
open  flame  mine  lamps  is  not  immediately  hazardous;  that  is,  the 
lights  having  become  extinguished,  a  warning  is  thus  given  and 
men  should  and  usually  do  leave  that  part  of  the  workings  at 
once.  The  oil  flame  will  burn  in  a  still  atmosphere  containing 
black  damp  until  the  oxygen  in  the  mine  air  is  reduced  to  16  per 
cent.  An  acetylene  flame  will  burn  in  such  an  atmosphere  until 
the  oxygen  is  reduced  to  12  per  cent.  This  means  that  the  flame 
must  be  kept  perfectly  still  and  there  must  be  no  air  current 
whatever.  If  the  lamps  are  worn  upon  the  cap  or  there  is  a 
current  of  air,  these  extreme  figures  will  be  very  considerably 
modified.  Danger  to  life  from  oxygen  starvation  does  not  begin 
until  certainly  10  per  cent  or  less  has  been  reached.  Again  it  may 
be  said  that  no  claim  is  made  that  air  containing  only  10  per  cent 
of  oxygen  is  physiologically  advisable  any  more  than  it  can  be  said 
that  the  air  in  an  improperly  ventilated  auditorium  filled  with 
people  is  physiologically  advisabe.  None  of  the  common  flame 


ACETYLENE    MINE    LIGHTING  205 

illuminants  will  burn  in  an  atmosphere  where  the  oxygen  content 
has  been  reduced  to  the  immediately  physiological  danger  point 
and  therefore  the  oil,  candle  and  acetylene  flames  give  adequate 
warning.  It  is  clear,  therefore,  that  where  the  impurity  in  mine 
air  is  carbon  dioxide,  no  open  flame  lamp  is  an  adequate  warning 
but  that  where  the  atmosphere  is  black  damp,  all  the  flame  illumin- 
ants give  warning.  The  miner's  lamp,  itself,  has  been  subject 
to  many  improvements  and  as  now'  sold  throughout  the  country,  is 
simple,  efficient,  substantial  and  well  calculated  to  serve  its  pur- 
pose. With  several  hundred  thousand  lamps  in  use,  there  have 
been  very  few  and  no  serious  accidents.  The  lamps  are  now  pro- 
vided with  two  or  three  extra  carbide  receptacles,  and  when  one 
is  removed,  containing  the  sludge,  all  that  is  necessary  is  to  put 
the  cap  on  it  and  remove  the  sludge  in  the  container  from  the 
mine  completely.  The  relative  cost  of  using  acetylene  has  been 
estimated  many  times  against  oil,  wax  and  candles  at  various 
places  and  at  various  prices.  Candle  power  considered,  there  is 
really  no  comparison  as  to  cost,  the  advantage  being  so  much  with 
acetylene  owing  to  the  fact  that  the  use  of  the  reflector  concentrates 
the  light  at  the  point  of  use,  whereas  with  oil,  the  rays  go  in  all 
directions  and  a  large  percentage  are  lost.  Compared,  however, 
light  for  light,  acetylene  costs  about  half  as  much  on  the  average 
as  oil  and  less  than  half  as  much  as  candles.  The  absence  of 
smoke  in  the  case  of  acetylene  increases  the  amount  of  useful  light 
and  permits  the  more  direct  application  of  the  rays  in  a  given 
direction.  The  increased  illumination  aids  materially  in  safeguard- 
ing the  miner  from  the  possibility  of  falls  and  gives  better  warning 
of  obstacles  and  dangers.  The  acetylene  mine  lamp  is  clean,  both 
in  itself  and  its  products  of  combustion.  Its  record  is  clean  and  it 
has  passed  through  the  experimental  stage  to  the  point  where  lamps 
are  now  made  to  meet  all  requirements  and  as  most  mine  lamps 
are  now  equipped  with  self-lighters,  even  the  match  hazard,  which 
accompanies  other  illuminants,  is  eliminated.  The  extended  use  to 
which  acetylene  has  been  put,  not  only  below  ground  but  above 
ground,  has  demonstrated  its  usefulness,  beyond  all  question  and 
as  its  application  to  mine  requirements  has  extended,  the  old  pre- 
judices have  given  away  to  the  practical  knowledge  of  the  illumi- 
nant  and  the  universal  verdict  of  the  miners  is  that  it  is  a  distinct 
and  notable  advance  and  one  wholly  to  their  advantage.  Perhaps 
the  best  statement  of  the  whole  subject  in  a  nutshell  is  to  be  found 


206  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

in  Bulletin  57  of  the  United  States  Bureau  of  Mines,  page  127-8, 
entitled  "Safety  and  Efficiency  in  Mine  Tunneling,"  by  David  W. 
Brunton  and  John  A.  Davis,  where  the  authors  state : 

"One  is  tempted  to  say  that  the  ideal  means  of  tunnel  illumi- 
nation is  found  in  the  portable  acetylene  lamp,  combining  as  it  does 
the  advantages  of  other  illuminants,  while  avoiding  most  of  their 
defects.  It  may  be  obtained  on  the  market  today  in  a  number  of 
different  designs  and  sizes  adapted  for  practically  every  kind  of 
work;  the  one  most  generally  observed  at  the  tunnels  visited  was 
about  the  size  of  an  ordinary  fruit  can  and  capable  of  burning  for 
eight  or  ten  hours  on  one  charge  of  carbide  and  water.  Although 
too  large  for  use  on  a  cap,  it  was  provided  with  a  hook  so  that  it 
could  be  suspended  from  any  convenient  place.  Lamps  suitable 
for  wearing  on  a  miner's  cap  are  obtainable  and  will  burn  for  two 
or  three  hours  without  recharging — an  operation  easily  performed 
in  tw'o  or  three  minutes.  The  initial  expense  of  an  acetylene  lamp 
is  not  high  and,  with  the  possible  exception  of  the  electric  arc,  it 
furnishes  the  brightest  known  artificial  light  used  for  underground 
work,  consuming  only  one-fifth  as  much  oxygen  as  candles.  It  is 
ordinarily  provided  with  a  reflector,  which  not  only  concentrates 
the  light  upon  the  work  w'here  it  is  needed,  but  shields  the  flame 
from  drafts  so  that  it  will  burn  steadily  unless  placed  directly  in 
front  of  the  exhaust  from  an  air  drill.  Extensive  use  by  some  of 
the  larger  mining  companies  in  this  country  has  shown  that  the 
cost  of  the  carbide  is  much  cheaper  than  either  oil  or  candles,  the 
use  of  acetylene  lamps  cutting  the  cost  of  light  practically  in  half. 
At  the  Saginaw  mine,  Menominee  Range,  Mich.,  the  cost  is  re- 
ported as  only  two  cents  per  shift  of  ten  hours.  Such  lamps  re- 
quire practically  no  attention,  are  completely  portable,  and  are  not 
subject  to  breakage  as  are  incandescent  lamps.  By  giving  the 
workman  plenty  of  light  his  efficiency  is  not  only  increased,  but  he 
is  better  able  to  guard  against  the  dangers  of  underground  work, 
such  as  an  insecure  roof,  an  unexploded  stick  of  dynamite  in  the 
muck  pile,  or  any  other  of  the  many  clangers  to  which  he  is  at  all 
times  exposed." 


A  Federal  Leasing  System 

BY     HON.     JOHN     F.     SHAFROTH, 
SENATOR  FROM    COLORADO. 


A  leasing  system  by  the  nation,  creating  the  relation  of  land- 
lord and  tenant  with  the  citizens  of  a  state  or  territory,  is  inconsist- 
ent with  our  form  of  government  and  generates  conditions  that 
will  make  it  a  failure.  The  government  can  sue  the  lessee  for  a 
breach  of  the  contract,  but  the  citizen  can  not  sue  the  government — 
his  sovereign — on  the  old  theory  that  "the  king  can  do  no  wrong." 
What  a  travesty  on  justice.  They  do  not  stand  upon  an  equal  foot- 
ing as  landlord  and  tenant  between  citizens  of  the  same  country. 
The  government  is  not  only  the  landlord,  but  the  lawmaker  and 
practically  the  determiner  of  all  disputes.  Years  ago  a  great  wrong 
w'as  perpetrated  on  the  citizens  of  the  San  Luis  Valley,  Colo.,  by 
the  secretary  of  the  interior  refusing  them  rights  of  way  for  canals 
and  reservoirs  for  irrigation  projects  under  the  general  law.  A 
rich  valley  of  more  than  1,000,000  acres  ever  since  has  remained 
a  barren  waste.  For  years  we  have  pleaded  with  the  government 
to  bring  suit  in  the  United  States  courts  against  the  claimants  of 
water  to  test  the  rights  claimed,  but  without  avail.  Senator  Thomas 
is  now'  trying  to  have  a  bill  passed  authorizing  the  persons  injured 
to  sue  the  government,  in  its  own  courts,  to  determine  their  rights. 

The  purpose  of  our  republic  is  to  control  national,  and  not 
local,  affairs ;  to  govern  its  citizens  and  not  to  go  into  a  leasing" 
business  which  must  produce  disputes  between  the  sovereign  and 
the  citizen.  The  object  of  the  government  has  always  been  to  aid 
settlement  and  development  in  order  to  produce  loyal  citizens  who. 
not  only  by  their  lives  but  by  their  resources  in  times  of  distress, 
will  support  the  republic.  A  man  will  fight  and  die  for  his  own 
home  and  property,  but  not  for  that  of  his  landlord.  Who  ever 
heard  of  a  country  that  was  made  great  by  tenants?  To  produce 
the  best  conditions  the  freest  opportunity  must  be  given  for  that 
development.  Anything  that  imposes  restrictions  or  difficulties 
hinders  and  impedes  them.  In  order  that  a  leasing  system  may  be 
self-supporting  there  must  be  that  selfish  interest  on  the  part  of 


208  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

the  landlord  which  exacts  a  sufficient  rental  to  make  the  property 
pay,  irrespective  of  development.  If  the  rental  is  low,  the  system 
will  not  be  self-supporting;  if  the  rental  is  high,  it  produces  an 
increased  tax  on  production  which  causes  an  increased  price  of 
many  times  the  royalty  to  the  ultimate  consumer. 

DOUBLE   JURISDICTION   MAKES   FEDERAL   LEASING    SYSTEM 
IMPRACTICABLE. 

There  will  always  be  a  conflict  of  jurisdiction  between  the 
officers  of  the  nation  and  of  the  state  as  to  the  police  powers  to  be 
exercised  relative  to  the  properties  which  are  the  subject  of  the 
leases.  These  conflicts  will  surely  produce  dissatisfaction,  irrita- 
tion and  litigation. 

We  have  in  Colorado  and  in  most  of  the  Western  states  coal- 
mining bureaus,  with  the  necessary  inspectors.  They  are  and  have 
for  years  been  exircising  police  powers  which  belong  exclusively 
to  the  state.  They  can  compel  large  and  costly  improvements  to  be 
made  in  order  to  prevent  gas  explosions,  such  as  the  construction 
of  air  flumes  extending  hundreds  and  hundreds  of  feet.  They  can 
require  daily  sprinkling  of  the  coal  dust.  They  can  order  timbering 
and  propping  on  a  large  scale  to  prevent  cave-ins.  They  can  seize 
a  mine  and  shut  it  down  if  they  believe  it  dangerous.  In  fact,  it  is 
within  their  power  to  make  a  coal-mining  enterprise  a  success  or 
failure.  All  of  this  power  is  necessary  to  prevent  the  sacrifice  of 
human  lives.  When  the  state  attempts  to  exercise  its  police  pow'ers 
as  to  the  working  of  a  mine  leased  by  the  nation,  it  is  certain  that 
conflicts  between  the  officers  of  the  federal  government  and  of  the 
state  will  arise,  producing  not  only  irritation  and  discontent,  but  a 
limitation  of  the  jurisdiction  of  the  federal  government  over  its 
leased  lands.  The  bills  all  provide  for  the  secretary  of  the  interior 
prescribing  the  rules  as  to  diligence,  skill,  care  in  operation  of  the 
property,  and  as  to  the  safety  and  welfare  of  the  miners. 

We  have  also  in  Colorado  and  most  of  the  mining  states  metal- 
liferous mining  bureaus  and  inspectors  with  the  same  powers  as 
to  safety  and  sanitation. 

We  have  in  the  arid  West  full  corps  of  water  commissioners — 
seventy  in  my  state — with  numerous  deputies.  They  have  power 
under  state  laws  to  distribute  the  waters  of  their  districts  according 
to  the  decrees  of  the  state  courts  for  domestic,  agricultural,  mining 
and  power  purposes.  If  for  power  purposes,  large  reservoirs  are 


A    FEDERAL    LEASING    SYSTEM  209 

constucted  by  lessees  of  the  government,  the  use  of  the  water  tlierer 
from  will  supplement  the  flow  of  the  stream  at  times  when  it  may 
not  be  needed  for  irrigation.  To  withhold  that  water  from  irriga- 
tion until  winter,  when  it  will  be  most  needed  for  the  generation  of 
power,  will  be  unbearable.  To  place  the  disposition  of  those  w'aters 
under  two  jurisdictions,  each  having  a  different  interest  to  serve, 
can  not  fail  to  produce  confusion,  chaos,  disputes,  and  sometimes 
personal  conflicts.  If  there  is  one  thing  above  another  for  which  a 
farmer  will  fight,  it  is  water  with  which  to  save  his  burning  crop. 
Will  not  these  conditions  make  a  leasing  system  by  the  federal  gov- 
ernment impracticable?  Does  not  all  of  this  demonstrate  that  the 
advice  of  the  late  Justice  John  M.  Harlan  of  the  United  States 
supreme  court  is  sound  when  he  said: 

A  national  government  for  national  affairs  and  state  governments  for 
state  affairs  is  the  foundation  rock  upon  which  our  institutions  rest. 
Any  serious  departure  from  that  principle  would  bring  disaster  upon  the 
American  system  of  free  government. 


DISASTROUS  EXPERIENCE  IN  LEASING  LEAD  MINES  OF  MISSIS- 
SIPPI VALLEY. 

The  country  has  had  an  experience  which  should  teach  us  a 
lesson.  In  1807,  in  order  to  stimulate  the  production  of  lead,  a 
munition  of  war  essential  to  the  defense  of  the  nation,  congress 
authorized  the  secretary  of  war  to  lease  the  lead  mines  upon  public 
lands  in  certain  territories  of  the  union  at  a  royalty  of  one-sixth 
of  the  production.  It  never  attempted  to  impose  such  a  system 
upon  public  lands  within  the  limits  of  a  state.  The  law  was  in  force 
when  Missouri,  Arkansas,  Iowa,  Illinois,  Wisconsin  and  Indiana 
were  admitted  into  the  union.  It  was  then  that  citizens,  legislators 
and  governors  began  to  protest  against  the  leasing  of  any  natural 
resource  within  the  limits  of  a  sovereign  state.  It  was  then  that 
Senator  Thomas  H.  Benton  of  Missouri  began  his  fight,  which 
lasted  for  years,  against  the  legislation.  After  the  admission  of 
Illinois  into  the  union  its  governor  openly  advised  that  the  citizens 
of  that  commonwealth  absolutely  refuse  to  pay  any  royalty  to  the 
federal  government  for  the  ores  extracted,  on  the  ground  that,  in 
equity,  the  ores  belonged  to  the  citizens  of  the  United  States,  people 
who  had  located  and  mined  the  ground,  and  the  government  could 
not  appropriate  to  its  own  use  resources  which  it  held  only  as  a 
trustee. 


210  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

President  Polk,  in  a  message  to  congress  in  1845,  said: 

The  system  of  granting  leases  has  proved  to  be  not  only  unprofitable 
to  the  government,  but  unsatisfactory  to  the  citizens  who  have  gone 
upon  the  lands,  and  must,  if  continued,  lay  the  foundation  of  much  future 
difficulty. 

The  cost  of  maintaining  the  system  had  been  four  times  as 
great  as  the  royalties  collected.  The  secretary  of  war  approved  the 
report  of  a  military  examiner,  who  declared  that  the  benefit  to  the 
government  bore  "no  just  proportion  to  the  injury  done  to  the 
mineral  region  of  the  country,  first  by  retarding  the  settlement  of 
the  country,  and,  second,  by  the  demoralizing  influence  of  the  sys- 
tem." 

Committees  of  congress  reported  time  and  again  in  favor  of 
the  repeal  of  the  leasing  statute.  One  of  the  reports  contained  the 
following : 

Your  committee  believes  that  it  is  bad  policy  to  introduce  or  continue 
in  any  state  or  territory  in  which  the  public  lands  are  any  system  the 
effect  of  which  shall  be  to  establish  the  relation  of  landlord  and  tenant 
between  the  federal  government  and  our  citizens. 

******** 

When  the  United  States  accepted  the  cession  of  the  northwestern 
territory,  the  acceptance  was  on  the  express  condition  and  under  a  pledge 
to  form  it  into  distinct  republican  states  and  to  admit  them  as  mem- 
bers of  the  federal  Union,  having  the  same  rights  of  freedom,  sov- 
ereignty and  independence  as  the  other  states.  This  pledge  your  com- 
mittee believes  would  not  be  redeemed  by  merely  dividing  the  surface 
into  states  and  giving  them  names,  but  it  includes  a  pledge  to  sell  the 
lands,  so  that  they  may  be  settled,  and  thus  form  states.  No  other  mode 
of  disposing  of  them  can  be  regarded  as  a  compliance  with  that  pledge. 

In  another  report  we  find  the  following : 

Now,  no  interest  is  felt  by  the  tenant  in  the  improvement  of  the 
property  itself;  he  does  not  become  fixed  in  his  employment  to  any  spot, 
is  sparing  of  his  outlays,  erects  no  permanent  works,  nor  does  he  call 
in  the  aid  of  science  and  practical  skill  to  overcome  the  obstacles  which 
meet  him  in  his  enterprise.  Make  them  private  property,  capital,  science 
and  skill  would  be  employed  in  erecting  machinery  and  the  deepest 
bowels  of  the  earth  explored  with  eagerness  and  profit  for  their  hidden 
treasures.  Subject  them  to  the  unimpeded  action  of  individual  energy, 
new  and  rich  developments  would  be  continually  made,  and  the  whole 
country  benefited  by  the  augmented  supply  at  a  cheaper  rate  which 
such  investments  would  certainly  produce. 

At  last,  in  1847,  after  retarding  the  development  of  the  country 
for  forty  years,  the  law  was  repealed. 

President  Fillmore,  in  a  message  to  congress  on  December  2, 
1849,  referring  to  the  policy  to  be  pursued  as  to  the  mineral  lands 
of  California,  said: 

I  was  at  first  inclined  to  favor  the  system  of  leasing,  as  it  seemed 
to  promise  the  largest  revenue  to  the  government  and  to  afford  the  best 
security  against  monopolies;  but  further  reflection  and  our  experience 


A    FEDERAL    LEASING    SYSTEM  211 

in  leasing  the  lead  mines  and  selling  lands  upon  credit  have  brought 
my  mind  to  the  conclusion  that  there  would  be  great  difficulty  in  collect- 
ing the  rents,  and  that  the  relation  of  debtor  and  creditor  between  the 
citizens  and  the  government  would  be  attended  with  many  mischievous 
consequences. 

The  supreme  court  of  the  United  States,  in  Mining  Co.  vs. 
Consolidated  Mining  Co.  (102  U.  S.,  167),  decided  in  1880,  in 
reviewing  the  history  of  the  systems  of  royalty  as  applied  to  the 
precious  metals,  and  the  careful  consideration  given  by  congress, 
and  the  conclusion  of  our  government  as  to  the  best  policy  to  be 
applied  to  the  mines  of  California,  said : 

Matters  remained  in  this  condition  with  slight  exception  until  July 
26,  1866,  when  congress  passed  a  law  by  which  title  to  mineral  land 
might  be  acquired  from  the  government  at  nominal  prices,  and  by  which 
the  idea  of  a  royalty  upon  the  product  of  the  mines  was  forever  relin- 
quished. (14  Stat,.  251.) 

What  a  glorious  result  followed  from  that  policy.  Millions  and 
millions  of  dollars  in  precious  metals,  mined,  perhaps,  at  a  cost  in 
labor  on  the  average  equal  to  the  value  of  the  ores  produced,  but 
which  furnished  an  indestructible  circulating  medium  as  basic  money 
that  relieved  commerce  and  produced  an  era  of  prosperity  through- 
out the  entire  world. 

Is  it  practicable,  after  such  a  signal  failure  of  the  federal 
leasing  system,  to  resurrect  that  tried  and  condemned  policy  and 
make  it  a  success  ?  Are  not  human  interests  and  passions  the  same 
now  as  then  ?  The  legislatures  of  the  Western  states  are  protesting 
now1  just  as  those  affected  in  the  same  way  protested  then.  The 
legislature  of  California  has  demanded  that  the  public  lands  be  taxed 
if  they  are  to  be  held  in  perpetuity  by  the  federal  government. 

It  has  been  said  that  times  have  changed  since  1847  and  that 
now  a  leasing  system  by  the  federal  government  would  be  a  success. 
What  is  there  to  sustain  such  a  contention?  Has  there  been  any 
experience  that  would  justify  such  an  assumption?  No;  but  there 
has  been  and  is  now  taking  place  a  vexing  experience  which  dem- 
onstrates the  contrary. 

LEASING  UNDER  FORESTRY  BUREAU  HAS  PROVEN  A  FAILURE. 

Under  the  law  setting  aside  forest  reserves,  which  was  enacted 
to  conserve,  by  the  shade  of  trees  and  brush,  the  snow  from  melting 
at  the  sources  of  streams  until  midsummer,  when  the  waters  would 
be  needed  for  irrigation  in  the  valleys  below,  the  forestry  bureau, 
without  any  direction  in  the  law,  proceeded  to  charge  for  the  graz- 
ing of  cattle  and  sheep  upon  those  forest  reserves.  It  first  started 


212  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

with  a  low  charge,  and  has  increased  the  rates  in  some  reserves 
more  than  700  per  cent,  in  an  effort  to  make  the  system  pay.  Yet 
the  result  has  been  that  the  collections  from  the  grazing  taxes  and 
timber  sales  have  amounted  to  only  about  one-half  of  the  expenses 
of  the  administration. 

The  following  table  shows  the  expenditures  and  receipts  for 
the  last  two  years : 

Fiscal  Year.                       Expenditures.          Receipts.  Net  loss. 

1912 $5,217,827.41         $2,109,256.91  $3,108.570.50 

1913 5,092,111.41          2,391,920.85  2,700,190.56 

The  appropriation  for  the  year  1914  is  $5,299,679. 

Do  these  figures  indicate  that  a  leasing  system  of  the  federal 
government  is  practicable  ?  Do  they  indicate  that  the  change  in  the 
times  has  been  favorable  to  the  existence  of  the  system  of  landlord 
and  tenant,  between  the  sovereign  and  its  citizens?  The  difficulty 
is  that  in  order  to  make  a  leasing  system  a  success  it  is  necessary 
to  increase  royalties,  and  that  is  one  of  the  very  causes  that  pro- 
duce irritation  between  the  officials  and  citizens.  It  is  the  same 
feeling  of  resentment  that  always  follows  when  the  landlord  raises 
the  rent.  It  is  very  much  magnified  by  governmental  action,  because 
our  citizens,  knowing  that  all  the  Middle  Western  states  received 
the  benefit  of  their  own  resources  and  that  we  are  entitled  by  our 
respective  enabling  acts  to  the  same  treatment,  feel  that  such  action 
upon  the  part  of  the  federal  government  is  oppressive.  Our  people 
can  never  get  over  the  feeling  that  wrong  is  being  perpetrated 
upon  them. 

Is  a  leasing  system  by  the  federal  government  under  such  cir- 
cumstances practicable?  How  long  will  the  government  be  willing 
to  expend  $3,000,000  a  year  in  excess  of  receipts  for  the  purpose 
of  maintaining  a  federal  leasing  system  when  the  people  most  inter- 
ested abominate  it  and  believe  that  it  is  against  their  interest? 

There  might  be  some  excuse  for  a  state  leasing  system  as  to 
its  own  lands,  because,  if  successful,  it  creates  a  fund  which  takes 
the  place  of  taxes  for  the  support  of  the  government  among  the 
very  people  who  pay  the  royalties.  But  a  leasing  system  by  a  state 
is  impracticable.  Colorado  has  a  sale  and  leasing  system  under 
which  it  leases  considerable  of  its  grazing  lands,  but  it  is  able  to 
obtain  only  nominal  rentals — 5  cents  an  acre  per  year  for  such 
lands  without  water.  Such  lands  sell  for  $5  to  $10  per  acre.  A 
5  per  cent  return  would  yield  25  to  50  cents  per  acre  per  annum, 


A    FEDERAL    LEASING    SYSTEM  213 

but  5  cents  an  acre  is  only  from  i  per  cent  to  one-half  of  I  per  cent 
on  the  value,  or  less  than  the  taxes  that  would  be  paid  upon  the 
same  were  they  in  private  ownership.  In  other  words,  rather  than 
maintain  a  perpetual  leasing  system,  it  would  be  more  remunerative 
to  the  state  to  give  its  lands  away,  so  they  could  become  the  sub- 
ject of  taxation.  So  it  is  selling  as  fast  as  applied  for.  The  re- 
ceipts to  the  national  government  from  grazing  taxes  and  sales  of 
timber  from  the  forest  reserves  are  only  i-J  cents  per  acre  per 
annum.  Of  these  receipts  25  per  cent  and  10  per  cent  are  paid  to 
the  state  for  school  and  road  purposes,  but  that  is  only  a  little  over 
one-third  of  a  cent  per  acre  per  annum,  which  is  not  one-fifth  of 
what  the  taxes  would  be  if  the  land  were  in  private  ownership. 

LEASING  SYSTEM  FOR  COAL  LANDS  WILL  PROVE  A  FAILURE. 

A  leasing  system  is  still  less  practicable  as  to  coal  lands.  Com- 
petition is  so  sharp  in  the  production  of  coal  that  no  operator  can 
hope  to  succeed  unless  he  has  the  most  improved  machinery  and 
the  best  facilities  for  mining  and  marketing  his  product.  Enormous 
capital,  therefore,  must  be  invested  in  nearly  every  instance,  and  a 
railroad  must  be  built  to  the  mine  from  the  nearest  operated  line. 
Men  will  not  make  such  large  investments  when  they  can  obtain 
only  a  lease,  subject  to  forfeiture  for  failure  to  perform  any  of  its 
provisions. 

No  better  illustration  of  this  fact  exists  than  that  found  in  the 
testimony  of  Gov.  Spry  of  Utah  before  the  house  committee  on 
the  public  lands.  He  said: 

We  have  the  Utah  Copper  Co.  out  there  in  Salt  Lake  valley,  operat- 
ing at  Bingham  Canyon,  about  20  miles  from  the  city.  There  is  a 
company  that  went  in  there,  and  solely  because  of  confidence  in  that 
dirt  they  spent  $30,000,000  before  they  had  $1  returned  to  them  from 
profits.  *  *  * 

If  we  had  put  that  proposition  (refering  to  a  leasing  system)  up  to 
the  Utah  Copper  Co.,  they  would  have  laughed  at  it.  *  *  * 

Gov.  Spry  further  testified  that  the  company  employs  3,000 
men  and  is  responsible  for  a  population  of  25,000  people  in  the 
Salt  Lake  valley.  Under  a  leasing  system  capitalists  would  not 
have  developed  this  great  property.  Consequently  the  nation  would 
not  have  received  the  benefit  of  its  large  product,  with  its  influence 
in  lowering  prices,  and  Utah  would  not  have  received  the  addi- 
tional 25,000  inhabitants. 

Is  it  not  plain  that  a  governmental  leasing  system  is  imprac- 
ticable, especially  as  to  large  enterprises,  and  is  it  not  equally  plain 


214  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

that  the  states  affected  would  thereby  be  retarded  both  in  develop- 
ment and  population? 

Capitalists  will  not  lend  money  to  open  up,  develop  and  buy 
expensive  machinery  for  coal  mines  held  under  leases,  subject  to 
forfeiture.  Who  ever  heard  of  a  bond  issue  secured  by  mortgage 
upon  a  leasehold  mining  estate  ?  There  is  no  market  for  such  bonds. 
Hence  the  enterprising  business  men,  unless  they  are  very  rich,  will 
practically  be  excluded. 

Now,  nearly  all  of  the  large  coal  companies  are  organized  by 
men  of  small  means,  who  interest  the  capitalists  in  the  enterprise. 
Lessees  usually  work  the  mine  to  their  own  advantage  and  not 
for  its  permanent  improvement,  as  do  proprietors. 

The  state  of  Colorado  owns  enough  coal  land  to  supply  the 
inhabitants  of  that  state  for  300  years,  yet  it  is  able  to  lease  only 
3  per  cent  of  its  coal  lands  at  10  cents  per  ton  royalty,  and  less 
than  one-half  of  those  leased  lands  are  being  worked.  Although 
there  are  leasing  law's  for  coal  on  state  lands  in  Wyoming,  Utah, 
Idaho,  Oregon,  New  Mexico  and  North  Dakota,  yet  no  one  has 
found  it  sufficiently  attractive  to  take  out  a  lease  in  any  of  those 
states.  If  a  leasing  system  backed  by  the  good  object  of  obtaining 
money  for  school  purposes  in  the  lessees'  own  state  is  a  failure,  how 
much  more  certain  must  be  the  failure  of  a  system  by  the  federal 
government,  the  royalties  of  which  the  people  feel  are  wrongful 
exactions  ? 

A  most  inconsistent  position  of  the  government  in  connection 
with  the  leasing  of  its  coal  lands  to  its  citizens  arises  from  the 
fact  that  in  order  to  make  the  system  a  success  it  must  encourage 
the  high  price  for  coal,  so  as  to  tempt  the  operators  by  profits  to 
enter  into  leases.  On  the  other  hand,  the  government  owes  a  duty 
to  the  people  to  curb  the  price  of  coal,  and  hence  discourage  high 
prices. 

COST  OF  COAL  UNDER  OWNERSHIP  AND  LEASING  SYSTEMS. 

While  a  leasing  system  by  the  government  has  been  a  success 
in  some  countries  from  the  standpoint  of  the  lessee,  it  has  been  a 
failure  in  those  same  countries  from  the  standpoint  of  the  con- 
sumer and  to  the  industries  dependent  upon  cheap  coal.  Under  its 
system  of  mining  the  coal  by  proprietors  the  United  States  has  pro- 
duced the  cheapest  coal  in  the  world  and  yet  paid  the  highest 


A    FEDERAL    LEASING    SYSTEM  215 

wages  to  the  miners.     It  is  this  cheap  coal  that  has  stimulated  our 
production  of  iron,  steel  and  many  other  industries. 

In  Senate  Document  No.  482,  by  Thomas  P.  McDonald,  there 
is  given  a  table,  compiled  from  official  reports,  which  shows  that 
under  the  system  now  in  force  in  the  United  States  the  price  of 
coal  at  the  mouth  of  the  mine  is  not  much  over  one-half  as  high 
as  in  those  countries  which  have  a  leasing  system.  Mr.  McDonald's 
table,  referring  to  bituminous  coal,  is  reproduced,  as  follows : 

Value 
per  ton 
Year.  Tons.        at  mine. 

United  States  1911  '  405,757,101  $1.11 

Nova   Scotia    1911  2  6,208,444  2.01 

New  South  Wales 1911  3  8,691,604  1.82 

New  Zealand    1912  4  2.066,073         (5) 

New  Zealand    (state  mine) 1912  6  371,628  2.00 

Victoria    (state  mine) 1912  7  396,042  2.28 

West   Australia    *  249,890  2.22 


production  in  1911.     By  E.  W.  Parker  of  the  U.  S.  Geological 
Survey. 

2  Report  of  department  of  mines  for  year  ending  Sept.  30,  1911. 

3  Annual  report  minister  of  mines,  New  South  Wales. 
*  Official  reports  relating  to  mines  and  minerals. 
°Not  given. 

•Report  of  manager  state  coal  mine,  Nov.  30,  1912. 
7  Report  of  manager  state  coal  mine,  1912. 
1  Report  of  mines  for  1911. 

The  following  table,  taken  from  the  same  senate  document, 
shows  the  price  of  bituminous  coal  per  ton  at  the  mine  for  1911, 
according  to  the  United  States  Geological  Survey,  to  be  even  lower 

than  that  given  above: 

Price 

States.                                                                              Tons.  at  mine. 

Illinois 53,679,118  $1.11 

Indiana  14,201,355  1.08 

Pennsylvania 144,754,163  1.01 

Ohio 30,759,986  1.03 

West  Virginia    59,531,580  .90 

These  figures  demonstrate  that  in  the  production  of  bituminous 
coal  there  is  no  monopoly  in  the  United  States.  Nor  can  there 
ever  be,  since  there  is  enough  coal  in  the  public  lands  to  supply  the 
world  for  5,000  years,  and  the  lands  can  be  disposed  of  under  re- 
strictions against  large  holdings,  which  will  follow  the  title. 

In  view  of  these  figures,  can  it  be  said  to  be  practicable  to 
change  from  the  tried  policy  of  the  disposition  by  sale  of  the  coal 
lands  to  a  leasing  system  ? 


216  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

In  the  statement  of  Mr.  McDonald  before  the  senate  committee 
on  territories,  on  May  7,  1913,  at  page  177  of  the  hearings,  is  the 
following : 

The  keen  competition  in  the  production  and  sale  of  coal  in  the 
United  States  under  our  system  of  private  ownership  of  the  coal  land 
is  saving  the  industries  that  consume  our  coal,  as  compared  with  those 
countries  operating  under  the  leasing  system,  hundreds  of  millions  of 
dollars  annually.  Our  present  consumption  is  about  400,000,000  tons 
per  year.  Now  compute  the  annual  saving  to  the  industries  of  the  United 
States  on  this  annual  coal  bill  of  400,000,000  tons  as  against  New  South 
Wales,  a  saving  of  $0.64  per  ton,  $256,000,000;  Nova  Scotia  and  New 
Zealand,  a  saving  of  $0.89  per  ton,  $356,000,000;  West  Australia,  a  saving 
of  $1.11  per  ton,  $444,000,000;  Victoria  (state  mine),  a  saving  of  $1.17 
per  ton,  $468,000,000. 

This  indicates  a  saving  to  the  industries  of  the  United  States  of 
approximately  a  million  dollars  per  day — no  mean  advantage  when  we 
are  seeking  a  world's  market  for  the  products  of  our  mills  and  factories. 

Because  of  these  facts  we  contend  that  it  is  utterly  impractica- 
ble for  the  government  to  establish  a  leasing  system  under  which 
operators  paying  royalties  can  meet  the  sharp  competition  now 
existing  among  companies  which  own  their  own  mines  and  use 
the  most  modern  machinery  for  the  extraction  and  transportation 
of  coal.  Hence  the  proposed  change  will  result  only  in  locking  up 
the  resources  of  the  West,  and  retarding  their  development.  By 
continuing  the  unlawful  permanent  orders  of  withdrawals  or  by 
acomplishing  the  same  thing  by  excessive  valuations,  communities 
and  industries  may  in  a  few  instances  be  driven  to  take  leases,  but 
for  a  general  policy  of  development  it  will  prove  a  failure. 

For  these  reasons  I  contend  that  the  establishment  by  the  gov- 
ernment of  a  leasing  system  for  the  natural  resources  of  the  public 
domain  within  the  boundaries  of  a  state  would  not  be  practicable. 


Why  Optimism? 

GEO.    OTIS    SMITH, 
DIRECTOR,     UNITED     STATES     GEOLOGICAL     SURVEY. 


Europe's  war  finds  its  echo  in  America's  industry.  What 
contrast  could  be  greater:  on  the  one  shore  of  the  Atlantic  all 
activity  seemingly  destructive  in  purpose;  on  the  other  shore, 
every  energy  directed  along  constructive  lines :  absolute  waste 
of  life  and  property  as  opposed  to  production  of  wealth  and 
betterment  of  life. 

Even  though  it  is  at  a  distance  that  we  view  the  terrilbe  dis- 
aster that  threatens  the  whole  continent  of  Europe,  optimism 
seems  a  lost  art.  Yet  sooner  or  later  this  epoch  of  catastrophe 
must  be  followed  by  a  period  of  repair,  and  the  longer  this  period 
is  delayed  the  greater  will  be  the  needs  involved  in  the  recon- 
struction and  replacement.  Where  war  has  torn  down  at  ter- 
rible speed,  peace  must  build  up  slowly. 

The  present  world  crisis  thus  becomes  America's  oppor- 
tunity, and  already  possibilities  are  opening  up  on  every  hand. 
Yet  mark  the  words  just  used — opportunity  and  possibilities.  The 
element  of  certainty  is  not  so  prominent  that  we  may  expect  to 
gain  much  in  this  period  of  readjustment  that  must  follow*  ex- 
cept as  we  grasp  the  opportunity ;  to  win  industrial  prosperity 
we  must  go  after  it.  Possibilities  will  become  ours  only  as  pre- 
paredness replaces  unpreparedness.  For  many  reasons,  there- 
fore, optimism  under  present  conditions  needs  to  be  something 
more  than  a  state  of  mind. 

Those  of  us  who  may  have  formed  the  habit  of  regarding 
industrial  conditions  in  this  country  as  fairly  definite  and  fixed 
have  had  a  rude  awrakening  during  the  past  few  months.  The 
interruption  of  international  trade  stopped  our  exports  of  cot- 
ton and  copper  and  our  imports  of  dye-stuffs  and  potash,  where- 
by several  important  industries  W7ere  wellnigh  paralyzed,  and 
even  now  the  recovery  seems  slow  if  not  uncertain.  Yet  varied 
as  have  been  these  changes  in  market  relations  and  commercial 
interactions,  and  startling  as  has  been  this  disturbance  of  the 


218  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

whole  balance  of  industry,  certain  fundamental  facts  and  laws 
remain  for  us  to  build  upon  and  indeed  the  lower  course  of 
foundation  stones  for  optimism  has  already  been  laid. 

Six  weeks  ago  when  I  selected  the  title  for  this  talk  before 
the  American  Mining  Congress,  I  expected  a  more  difficult 
task  in  explaining  the  faith  that  is  in  me.  In  these  few  weeks, 
however,  the  business  situation  has  so  materially  improved  that 
optimism  may  seem  almost  compulsory  and  my  presentation  of 
the  subject  that  much  more  commonplace.  Evidence  of  business 
betterment  is  before  us  on  every  hand,  and  the  reasons  for  op- 
timism have  been  set  forth  in  the  past  month  by  many  speakers 
and  writers,  especially  men  in  close  touch  with  the  business  sit- 
uation. 

This  evidence  in  the  case  is  known  to  all  and  needs  only  to 
be  called  to  mind.  The  United  States  farmer  has  harvested  a 
five  billion  dollar  crop  and  there  is  a  high-price  market  for  all 
our  surplus  food  stuffs;  already  our  grain  is  pouring  across  the 
Atlantic  from  every  great  seaport.  Foreign  orders  have  started 
our  factories  to  turning  out  goods  such  as  have  been  heretofore 
manufactured  in  the  war-swept  countries.  The  millions  of  men 
who  are  fighting  are  not  w'orking,  and  yet  these  hordes  of  sol- 
diers must  be  clothed  and  equipped.  Rush  orders  are  reported 
for  gloves  and  shoes  by  the  million  pairs,  for  blankets  by  the 
hundred  thousand,  for  sweaters  and  under-garments  by  the  mil- 
lion, and  even  shaving-brushes  by  the  half  million.  Many  tex- 
tile mills  are  running  over  time  and  factory  operation  has  in- 
creased, which  at  once  tends  to  relieve  the  stagnation  in  the 
steam-coal  trade.  The  steel  situation  has  turned  from  serious 
depression  to  rapid  improvement  and  the  metal  workers  are  re- 
ceiving large  export  orders.  All  these  facts  point  to  a  general 
business  improvement  in  which  the  whole  mineral  industry  may 
soon  expect  to  share. 

No  less  real,  though  perhaps  less  conspicuous,  is  the  effect 
of  the  new  federal  banking  system  in  ending  our  financial  emer- 
gency, which  w'as  acute  and  threatened  to  become  chronic.  To- 
day the  financial  horizon  is  so  nearly  cloudless  that  the  prophets 
of  bad  weather  have  little  upon  which  to  base  their  predictions. 
The  new  system  makes  the  money  reserves  mobile  as  never  be- 
fore, and  extension  of  credit  is  now  possible,  without  the  veto 
power  remaining  in  the  hands  of  a  small  group  of  big  men. 


WHY    OPTIMISM?  219 

There  is  more  promise  to  the  industrial  world  in  having  the  con- 
trol of  credit  under  law',  with  the  people's  own  officers,  rather 
than  in  having  it  under  cover,  with  the  representatives  of  big 
business. 

The  establishment  of  foreign  credits  in  this  country  carries 
large  promise  of  the  continuance  of  the  present  gratifying  re- 
ceipt of  export  orders  and  the  consequent  industrial  activity.  Our 
current  indebtedness  to  England  and  other  creditor  nations  is 
apparently  less  than  has  been  generally  supposed,  so  that  the 
shift  in  balance  of  trade  which  has  been  so  rapid  during  these 
four  months  of  war  may  even  lead  the  more  optimistic  of  us  to 
see  our  country  changing  from  a  debtor  nation  to  a  creditor  na- 
tion. Sir  George  Paish  is  reported  as  declaring  a  billion  dollar 
trade  balance  in  favor  of  the  United  States  as  possible  even  in 
1915,  which  would  be  a  50  per  cent  increase  over  1913.  Already 
the  recovery  has  been  rapid  since  the  outbreak  of  the  war.  In 
August  the  balance  was  against  the  United  States  by  20  million 
dollars,  but  in  September  our  exports  exceeded  our  imports  by 
17  million;  for  October  this  favorable  balance  increased  to  57 
million,  and  last  month  the  exports  for  the  ten  principal  custom 
districts  exceeded  the  imports  the  first  week  by  10^  million  dol- 
lars, the  second  week  by  nearly  22  million,  the  third  week  by  14 
million,  and  the  fourth  week  by  16  million,  or  63  million  for  the 
whole  month. 

Still  another  reason  for  belief  in  business  betterment  is  the 
recognition,  now  becoming  widespread,  of  the  general  interde- 
pendence of  big  business  and  the  general  public.  On  the  one 
side,  the  people  are  realizing  that  they  are  and  have  been  in  real- 
ity the  silent  partner  in  big  business,  and  now  that  there  has 
come  the  promise  of  some  regulation  that  will  in  large  part  pre- 
vent monopolistic  centralization,  the  people  are  interested  in  get- 
ting their  share  of  returns  that  can  come  only  with  operation  at 
a  profit.  On  the  other  hand,  the  managers  of  the  large  corpora- 
tions, the  trustees  of  the  investing  public,  are  beginning  to  see 
that  a  certain  financial  security  goes  with  public  confidence,  and 
that  the  attitude  to  the  public  so  tersely  expressed  thirty  years 
ago  by  a  pioneer  in  railroad  financing  does  not  pay  dividends 
today. 

Secretary  Redfield  recognizes  three  periods  of  business  con- 
dition as  naturally  following  the  declaration  of  war  on  August 


220  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

i  last — those  of  shock,  stimulation,  and  readjustment.  These 
three  must  be  expected  to  affect  in  the  same  order  all  branches  of 
American  business,  though  the  transition  from  one  period  to  the 
next  may  not  be  simultaneous  in  all  branches.  Thus  those  of  us 
who  may  be  specially  interested  in  the  copper  market  may  find 
some  encouragement  in  the  fact  that  for  several  weeks  after  war 
was  declared  the  exportation  of  wheat  felt  the  shock  and  thou- 
sands of  carloads  accumulated  at  Eastern  ports.  Yet  since  Sep- 
tember, wheat  has  been  pouring  across  the  Atlantic  as  never  before. 
With  cotton  the  period  of  shock  has  been  longer,  but  stimulation 
of  export  has  now  begun.  With  copper  the  resumption  of  sales 
to  Europe  seems  slow  in  coming,  but  come  it  must,  for  in  the  mod- 
ern world,  whether  at  war  or  peace,  the  red  metal  is  a  necessary 
of  life. 

Of  course  optimism  is  apt  to  go  to  extreme.  Already  we  are 
hearing  such  expressions  as  "trade  boom,"  or  "opportunity  unpar- 
alleled in  history"  and  "avalanche  of  prosperity,"  and  even  hard- 
headed  business  men  are  quoted  as  thus  characterizing  the  present 
situation.  Some  of  us,  how'ever,  are  timid  when  it  comes  to  ava- 
lanches, for  even  avalanches  of  prosperity  will  sweep  men  off  their 
feet.  All  this  kind  of  talk  indicates  that  a  period  of  over-stimu- 
lation may  threaten  us,  a  condition  that  is  somewhat  symtomatic  of 
the  American  temperament.  The  four  months'  record,  however, 
can  be  summarized  thus :  while  European  countries  have  been 
mobilizing  their  armies  and  calling  to  the  field  of  battle  their  re- 
serves of  soldiers,  America  has  mobilized  its  credit  and  begun  to 
send  forward  to  the  market  its  vast  reserves  of  food-stuffs  and 
mineral  products. 

Turning  now  to  the  special  review  of  our  mining  industry  as 
affected  by  the  w'ar,  what  reasons  are  there  for  optimism?  I  find 
the  largest  source  of  assurance  of  the  ability  of  this  industry  to 
weather  the  period  of  readjustment  in  the  record  of  its  develop- 
ment in  the  past.  The  epoch  of  rapid  growth  of  the  mineral  in- 
dustry began  about  35  years  ago,  and  this  third  of  a  century  just 
passed  has  witnessed  a  wonderful  development.  Clarence  King  in 
the  first  administrative  report  of  the  United  States  Geological  Sur- 
vey analyzed  the  situation  in  1879  in  these  words:  "We  are  yet  at 
the  very  threshold  of  the  industrial  life  of  the  Republic."  and  look- 
ing forward  he  added :  "The  mineral  industries  will  soon  reach  an 
annual  yield  of  a  thousand  million  dollars  of  value."  May  I  now 


WHY    OPTIMISM?  221 

remind  you  that  last  year's  record  was  two  and  one-half  thousand 
millions. 

For  this  period  of  development  since  1880,  statistics  of  the 
mineral  production  are  available  and  the  extent  of  the  expansion  of 
the  industry  can  be  summed  up  in  the  statement  that  the  value  of 
the  output  has  increased  nearly  seven-fold  while  our  population  has 
less  than  doubled.  If  we  compare  directly  the  output  per  capita  of 
population,  the  record  of  increase  in  the  more  important  mineral 
products  becomes  really  instructive  or  even  inspiring.  Thus  in 
this  period  of  33  years  the  consumption  of  coal  per  capita  has  in- 
creased from  less  than  a  ton  and  a  half  to  nearly  six  tons — an  in- 
crease of  357  per  cent.  Similarly  the  production  of  iron  ore  in- 
creased 337  per  cent,  of  petroleum  391  per  cent,  copper  1,200  per 
cent,  cement  2,087  Per  cent ;  but  gold  and  silver  increased  only  23 
and  22  per  cent  respectively,  while  with  lead  the  increase  was  125 
per  cent,  and  with  zinc  638  per  cent.  This  is  indeed  a  record  of 
which  mining  men  of  this  generation  may  be  proud. 

If  statistics  for  the  more  important  agricultural  products  are 
studied  in  a  similar  manner  it  is  found  that  the  total  increase  in 
the  same  period  has  not  much  more  than  kept  pace  with  the 
growth  in  population.  This  is  true  of  the  two  leading  grains,  corn 
and  wheat,  the  one  having  somewhat  more  than  doubled,  the  other 
not  quite  doubled  in  the  third  of  a  century,  so  that  the  production 
per  capita  shows  only  a  small  percentage  of  increase.  With  cotton 
the  gross  increase  has  been  larger,  approaching  130  per  cent,  but 
wool  has  utterly  failed  to  increase  as  rapidly  as  the  population.  It 
is  only  sugar  that  shows  an  increase,  both  in  domestic  production 
and  in  consumption,  at  all  comparable  with  that  of  the  half  dozen 
minerals  mentioned,  the  per  capita  increase  being  394  per  cent,  or 
about  the  same  as  the  other  carbon  compounds,  coal  and  petroleum. 

There  are  other  comparisons  that  may  be  made  with  the  result 
of  strengthening  an  optimistic  tendency.  In  this  period  metal  min- 
ing has  passed  from  the  bonanza  stage  to  the  low  grade  proposi- 
tion— a  change  which,  as  Doctor  Raymond  has  remarked,  by  the 
creation  of  larger  and  more  permanent  communities  has  laid  safe 
foundations  of  civilization  and  progress.  The  baser  metals  have 
come  to  the  front  and  the  small  increase  in  output  of  gold  and  sil- 
ver has  been  made  in  part  with  these  noble  metals  in  the  role  of 
by-products  in  copper  and  lead  mines. 


222  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

An  even  more  gratifying  phase  of  this  mining  development  is 
the  marked  increase  in  man's  productive  capacity.  Let  us  take  the 
2O-year  period  1889-1909  and  analyze  the  coal-mining  record. 
Roughly  stated,  the  number  of  mine-workers  a  little  more  than 
doubled  in  that  period,  the  output  of  coal  more  than  trebled,  and 
the  capital  investment  more  nearly  quadrupled.  The  exact  per- 
centages are  123  per  cent  increase  in  employes,  226  per  cent  in- 
crease in  production,  252  per  cent  increase  in  capital.  Stated  in 
terms  of  efficiency,  the  mine-worker  increased  his  individual  out- 
put from  471  to  691  tons  a  year,  while  the  average  annual  output 
per  dollar  of  capital  remained  nearly  the  same,  about  two-fifths  of 
a  ton,  the  increase  in  capitalization  per  ton  of  output  being  less 
than  8  per  cent.  Most  of  this  increase  in  capital  outlay  was  due  to 
equipment  expenditure,  the  improvement  in  mechanical  equipment 
appreciably  adding  to  the  mine-worker's  efficiency  and  comfort. 

In  iron  mining  the  record  for  the  same  period  is  even  more 
striking;  the  number  of  miners  increased  less  than  one-half,  the 
capitalization  nearly  trebled,  and  the  output  nearly  quadrupled.  In 
the  iron  mines,  then,  both  labor  and  capital  became  more  efficient, 
the  output  per  miner  increasing  from  385  to  995  tons  and  the  pro- 
duction per  dollar  of  capital  from  one-seventh  to  one-sixth  of  a 
ton.  In  the  case  of  coal  mining,  we  know  that  this  improvement 
did  not  halt  with  the  census  year  of  1909,  for  since  then  the  coal 
output  per  miner  has  increased  another  71  tons,  or  more  than  10 
per  cent  in  the  four-year  period.  All  this  tells  the  story  of  steadily 
increasing  efficiency  of  mine-worker,  mine  equipment,  and  mining 
methods — that  is,  of  the  contributions  by  labor,  capital  and  engin- 
eering. 

The  net  results  of  this  marvelous  development  as  well  as  this 
increased  efficiency  is  that  not  only  has  the  mining  industry  kept 
pace  with  the  demands  of  other  industries,  but  that  in  certain  min- 
eral products  We  are  able  to  turn  out  much  more  than  we  can  con- 
sume at  home.  In  the  last  five  years  this  excess  of  copper  mined 
has  been  about  50  per  cent  and  of  copper  refined  in  American  works, 
fully  100  per  cent,  one-third  of  the  copper  from  domestic  ores  and 
one-half  of  the  metal  turned  out  by  the  refineries  having  been  ex- 
ported. The  other  mineral  product  which  is  produced  in  the  United 
States  in  such  quantity  as  to  make  the  industry  largely  dependent 
upon  a  foreign  outlet  is  petroleum,  of  which  20  per  cent  is  ex- 
ported in  one  form  or  another,  but  chiefly  as  refinery  products.  Of 


WHY    OPTIMISM?  223 

such  important  mineral  products  as  coal  and  cement  the  exports 
have  been  insignificant,  and  the  same  is  true  of  exports  of  lead  and 
zinc  smelted  from  domestic  ores.  Yet  for  all  of  these  mineral  prod- 
ucts the  mine,  mill  and  smelter  capacity  is  far  in  excess  of  the  de- 
mands of  domestic  consumption.  Obviously  there  is  good  oppor- 
tunity for  increase  of  output  without  appreciable  capital  outlay,  pro- 
vided a  market  can  be  found  for  the  product. 

Under  present  conditions  the  domestic  market  may  well  be 
looked  to  for  increased  consumption  of  the  home  output  of  some 
minerals  which  have  been  imported  from  European  countries,  such 
as  aluminum,  arsenic,  barytes,  fluorspar,  magnesite  and  manganese, 
most  if  not  all  of  which  can  be  found  in  the  United  States  in  suf- 
ficient quantities  to  meet  the  domestic  demand.  Again,  the  Ameri- 
can manufacturers  of  certain  articles  that  have  been  imported  from 
Europe  should  be  expected  to  make  large  demands  for  the  metals 
which  form  the  basis  of  those  manufactures.  Judging  from  the 
inquiries  that  come  every  day  to  the  Geological  Survey,  this  type  of 
the  expansion  of  the  home  market  is  lively  and  should  result  in  the 
aggregate  in  some  appreciable  increase  in  the  demands  upon  the 
mineral  producer. 

It  is,  however,  the  opportunity  of  a  larger  foreign  market  for 
American  mineral  products  that  now  seems  more  alluring.  During 
the  war  period  the  war  itself  will  continue  to  create  demands  upon 
the  mineral  industry  of  America.  The  historian  Ferrero  is  quoted 
as  terming  the  European  combat  a  war  of  iron  and  coal ;  he  might 
even  more  aptly  included  gasoline  as  indispensable  in  modern  war- 
fare. The  consumption  of  metal  on  the  firing  line  and  of  fuel  be- 
hind the  line,  on  both  land  and  sea,  is  largely  in  excess  of  any  nor- 
mal use  in  time  of  peace. 

And  when  the  peace  comes  to  Europe  for  which  peace-loving 
America  prays,  the  indirect  effects  of  war  must  continue  to  benefit 
American  industry.  The  markets  now  opened  to  our  zinc,  our  steel, 
our  coal,  by  reason  of  the  enforced  shut-down  of  Belgian  smelters, 
German  mills,  and  English  and  French  mines,  must  be  supplied 
from  this  country  even  after  the  treaties  of  peace  are  signed.  Years 
will  be  necessary  to  put  industry  on  its  former  footing  in  the  coun- 
tries now  at  war,  and  it  seems  reasonable  to  expect  that  currents 
of  commerce  now  set  up  will  not  be  quickly  changed  after  peace 
has  been  restored. 


224  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

Industrial  independence  is  a  goal  toward  which  a  nation  should 
face,  but  a  goal  which  it  should  not  have  either  the  intention  or  the 
desire  to  attain.  Even  in  a  country  so  diversified  as  ours  in  its 
natural  bounties  domestic  production  of  everything  consumed  is 
not  desirable  nor  profitable.  Exchange  of  commodities  with  foreign 
countries  becomes  necessary,  for  instance,  just  as  soon  as  America 
can  mine  and  smelt  copper  or  produce  and  refine  petroleum  more 
cheaply  than  it  can  grow  tea  or  raise  sheep  or  cattle.  Then  the 
home  market  for  cheap  meat  and  wool  and  tea  necessitates  a  foreign 
market  for  our  copper  and  oil.  Of  course,  the  more  we  as  a  people 
are  independent  of  goods  sent  from  other  countries  the  less  we  are 
dependent  on  a  foreign  market  for  our  own  products.  Large  im- 
ports necessitate  large  exports,  else  the  balance  of  trade  will  swing 
too  far  on  the  wrong  side.  Nor  can  we  shut  our  eyes  to  the  volume 
of  exports  needed  to  meet  the  interest  obligations  due  the  foreign 
capital  invested  in  our  railroad  and  industrial  securities. 

As  we  look  toward  the  south  we  find  that  our  commerce  with 
South  America  for  the  last  four  years  has  been  one-sided  to  the 
extent  of  an  unfavorable  annual  trade  balance  averaging  more  than 
80  millions  of  dollars.  The  fact  that  the  balance  of  trade  is  against 
the  United  States  in  two  of  the  three  "A  B  C"  countries  should  be 
taken  only  as  an  invitation  to  export  more.  That  80  millions  not 
only  measures  the  present  opportunity  for  exports  to  South  America 
but  also  suggests  the  chance  for  further  development  of  trade  rela- 
tions. We  need  meat  and  hides  from  Argentina,  tin  ore  from 
Bolivia,  rubber  and  coffee  from  Brazil,  nitrate  from  Chile,  platinum 
from  Colombia,  cacao  from  Ecuador,  w'ool  from  Peru  and  Uruguay 
and  coffee  from  Venezuela.  What  can  we  export  in  exchange? 

To  increase  industrial  prosperity  this  country  needs  to  export 
finished  rather  than  crude  products  and  to  import  raw  materials 
rather  than  manufactures.  It  is  the  product  of  American  labor 
rather  than  the  bounty  of  pur  natural  resources  that  preferably 
should  go  into  the  world's  markets.  Betterment  of  industrial  con- 
ditions can  come  best  through  expansion  of  manufacturing.  The 
increase  in  the  element  of  labor  in  the  product  exported  will  mean 
that  we  are  not  bartering  away  our  heritage  of  natural  resources, 
but  rather  that  we  are  using  these  resources  as  a  basis  simply  for 
the  expenditure  of  labor,  which  renews  itself. 

Fortunately  only  a  small  part  of  our  iron  and  steel  exports  is 
in  the  form  of  pig,  bar,  billets  and  ingots,  and  indeed  not  only  do  the 


WHY    OPTIMISM?  225 

manufacturers  of  iron  and  steel  represent  by  far  the  largest  values, 
but  the  steel  rails  and  wire  alone  outweigh  the  crude  metal  exported. 
In  our  copper  exports,  however,  the  ratio  is  quite  the  opposite,  the 
value  of  exported  manufactures  of  copper  being  only  about  one- 
sixth  of  that  of  the  copper  exported  in  the  form  of  pig,  ingot  and 
bar.  This  contrast  is  suggestive,  and  indeed  some  immediate  expan- 
sion in  the  export  of  copper  manufactures  seems  warranted.  For 
example,  the  item  of  electrical  equipment  and  supplies,  of  which 
the  exorts  have  doubled  in  the  last  eight  years,  with  only  a  small 
percentage  going  to  Europe,  suggests  that  we  now'  have  an  excellent 
opportunity  to  secure  a  larger  market,  while  the  principal  European 
competitor  of  the  United  States  is  temporarily  eliminated. 

In  the  matter  of  crude  minerals,  whether  fuels  or  metals,  the 
export  trade  of  the  United  States  promises  expansion.  Too  much 
emphasis  can  hardly  be  placed  upon  America's  strategic  position  in 
the  possession  of  large  reserves  of  coal.  Not  only  does  the  United 
States  mine  40  per  cent  of  the  world's  output  of  coal,  but  our  coal 
tonnage  in  the  ground  is  one-half  the  known  reserves  of  the  world. 
Mr.  Parker  has  lately  pointed  out  that  two  diverse  policies  have 
governed  the  two  countries  that  rank  next  to  the  United  States  as 
coal  producers.  England  has  promoted  her  commerce  by  exporting 
about  20  per  cent  of  her  coal  output,  w'hile  Germany,  with  larger 
coal  reserves,  has  exported  little  coal,  preferring  to  use  it  in  her 
own  factories,  the  products  of  which,  however,  go  all  over  the  world. 
It  would  seem  that  America  might  safely  occupy  middle  ground  in 
the  policy  of  coal  exports  and  yet  increase  greatly  her  foreign  trade. 
The  exports  have  been  only  about  4  per  cent  of  the  total  production, 
and  of  this  only  a  small  fraction — one  and  one-fifth  million  tons — 
went  across  the  seas  last  year.  A  change,  however,  has  already  set 
in,  for  large  contracts  are  reported  with  Italy,  Greece,  Argentina 
and  Brazil. 

Coming  down  to  bottom  facts,  the  United  States  will  profit  by 
the  European  war  only  as  the  nation  makes  larger  and  wiser  use 
of  its  mineral  resources.  Foreign  markets  in  the  main  can  be  won 
and  held  only  as  the  quantity  or  quality  of  the  "Made  in  America" 
product  rivals  that  of  the  goods  offered  by  the  other  producing  na- 
tions. The  buyer,  whether  he  be  in  the  far  East  or  in  South  Amer- 
ica, wants  the  most  and  the  best  for  his  money.  Of  course  at  a 
time  like  the  present  we  can  not  shut  our  eyes  to  the  obligations 
of  a  world-humanity,  and  just  as  American  food-stuffs  are  now' 


226  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

being  given  to  the  starving  Belgians,  so  America  capital  may  later 
be  forced  to  bear  its  share  in  the  financial  readjustments  that  must 
follow  a  long-continued  war.  Yet  it  would  seem  a  safe  rule  of 
national  conduct  that  industry  should  begin  at  home,  and  therefore 
every  industrial  opportunity  in  America  should  be  improved.  If 
these  opportunities  are  recognized  and  grasped  every  one  of  us  can 
indulge  in  optimism. 


The  Adjustment  of  Industrial  Disputes  Affecting:  the  Public  Service 

BY    HON.    JAMES    A.    EMERY, 
WASHINGTON,    D.    C. 


Ever  since  the  organization  and  report  of  the  Anthracite  Coal 
Strike  Commission  in  1902,  an  increasing  amount  of  thought  has 
been  given  to  practical  methods  of  settling  the  enormously  de- 
structive and  wasteful  industrial  controversies  which  at  times  para- 
lyzing industry  and  transportation,  have  frequently  caused  incal- 
culable economic  loss ;  not  only  greatly  injuring  and  sometimes 
ruining  individuals,  but  obstructing  or  stopping  service  upon  which 
the  public  is  dependent  for  daily  necessities.  The  Lemeux  Act. 
Canada's  legislative  experiment  with  this  problem,  has  been  the 
subject  of  much  discussion  in  our  own  country.  It  does  not  deny 
the  right  to  strike  or  lockout,  but  endeavors  to  compel  the  parties 
to  the  controversy  to  submit  their  differences  to  an  arbitration,  the 
findings  of  w'hich  either  or  both  may  subsequently  reject,  but  with- 
out which  neither  may  legally  strike  or  lockout.  It  is  contended 
by  the  Canadian  authorities  and  by  many  shrewd  observers  that  the 
Act  has  a  valuable  moral  effect.  Although  it  is  admitted  that  in 
the  final  test  it  is  incapable  of  practical  enforcement,  since  events 
have  demonstrated  that  government  could  not,  without  civil  war, 
undertake  to  confine  a  labor  organization  and  its  sympathetic  sup- 
porters who  struck  in  disobedience  of  the  law.  But  the  law  and  the 
public  opinion  which  it  developed  have  undoubtedly  had  the  not- 
able moral  effect  of  decreasing  trivial  strikes  and  causing  both  par- 
ties in  controversies  to  think  before  acting.  The  principle  of  the 
Canadian  Act  cannot  be  applied  to  private  industry  in  our  country 
under  our  organic  law.  It  would  create  a  condition  of  "involun- 
tary servitude." 

The  mere  stoppage  of  private  industry,  however  serious  to 
those  involved,  does  not  represent  the  form  of  strike  most  injurious 
to  the  public.  We  suffer  from  notable  strikes,  or  threats  of  strike, 
not  only  on  interstate  railroads  but  on  the  various  traction  systems 
upon  which  cities,  great  and  small,  and  their  suburban  communities 
which  have  grown  up  about  them,  are  absolutely  dependent  not 


228  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

only  for  daily  transportation  from  residence  to  work,  but  for  a 
continuous  supply  of  the  necessities  as  well  as  the  conveniences  of 
daily  life.  The  suspension  of  such  service  is  a  community  disaster, 
sometimes  equal  in  the  loss,  suffering  and  inconvenience  which  it 
entails  to  the  stoppage  of  the  local  light  or  water  system.  What  is 
true  of  such  a  community  catastrophe  is  true  in  a  larger  w'ay  not 
only  of  the  great  transportation  systems,  but  of  a  few  industries 
producing  the  fundamental  necessities  of  life. 

In  purely  private  employment,  these  deliberate  and  concerted 
stoppages  of  industry,  while  often  entailing  great  losses  to  both 
parties,  are  nevertheless  the  inevitable  incident  of  the  exercise  of 
elementary  private  rights.  The  state  can  neither  compel  individuals 
to  give  work  nor  others  to  take  it.  Trie  losses  directly  and  indi- 
rectly suffered,  however  deplorable,  are  but  incident  to  the  exercise 
of  personal  rights,  which,  however  directed  by  bad  judgment,  are 
part  of  the  tax  paid  for  the  preservation  of  individual  freedom,  but 
when  the  service  of  a  corporation  or  business  becomes  wholly  af- 
fected with  the  public  interest  or  dominated  by  that  feature  so  that 
its  uninterrupted  operation  is  essential  to  Well  being  or  the  life  of 
the  community,  is  it  not  a  question  whether  corporations  or  large 
groups  of  individuals  organized  for  the  furtherance  of  their  private 
interest,  may  not  have  their  collective  or  individual  contract  of 
service  controlled  and  regulated  to  protect  the  interest  of  the  public  ? 

It  is  not  suggested  that  any  individual  or  combination  of  in- 
dividuals can  be  compelled  to  remain  at  work,  but  in  view  of  the 
public  character  of  the  service  rendered,  may  the  state  recognize 
and  enforce,  under  penalty,  a  contract  of  service  by  which  the  indi- 
vidual employed  by  a  public  utility  and  the  public  utility 
itself,  each  under  appropriate  penalty,  agree  that  the  one 
will  not  lock  out  its  employes,  nor  the  other  become 
party  to  a  collective  movement  to  paralyze  the  public 
service  by  quitting  until  the  issue  relating  to  conditions  of  employ- 
ment have  been  passed  upon  by  some  impartial  tribunal  constituted 
by  the  parties.  Such  a  contract,  viewed  from  the  standpoint  of  the 
employer  operating  the  public  utility,  means  that  he  agrees  by  vir- 
tue of  the  franchise  which  he  receives  and  the  character  of  his  rela- 
tion to  the  community,  that  he  will  condition  his  freedom  of  action 
by  agreeing  in  his  franchise  not  to  do  that  which  will  deprive  the 
community  of  his  service.  The  individual  or  organized  employe 
is  free  to  make  or  reject  the  contract  offered.  He  is  not  compelled 


ADJUSTMENT  OF  INDUSTRIAL  DISPUTES  229 

to  enter  into  the  service  of  the  public  utility,  but  having  done  so, 
he  conditions  his  quitting  by  voluntary  contract  made  in  view  of 
the  character  of  the  service  rendered.  Would  such  a  contract  make 
either  party  sustain  any  involuntary  relation  with  the  other  ?  Would 
not  the  condition  attached  to  the  contract  be  one  justified  by  the 
character  of  the  service  rendered  and  the  public  interest  involved? 
For  any  form  of  arbitration  which  compels  either  party  to  continue 
to  sustain  a  relation  created  without  preliminary  condition,  there  can 
be  found  but  little  defense.  Private  employment,  least  of  all,  dis- 
closes any  condition  which  would  sanction  it.  The  issue  here  pre- 
sented is  whether  or  not  the  interest  of  the  public  in  the  continued 
operation  of  a  utility  privately  owned  and  operated,  but  dedicated 
to  a  public  service,  is  so  dominant  in  the  light  of  existing  social 
conditions  and  necessities  that  its  voluntary  contracts  of  employment 
may  and  ought  to  be  so  conditioned. 

The  discussion  may  well  proceed  within  a  very  narrow  range 
of  obvious  public  utilities.  The  principle,  once  recognized,  is  cap- 
able of  transfer,  always  within  rational  limitations,  to  other  spheres 
of  like  action.  Within  such  limits  is  the  application  of  the  principle 
suggested  desirable  ?  It  is  obvious  that  it  does  not  apply  to  all  fields 
of  industrial  controversy,  nor  can  any  remedy  hope  to,  but  would  it 
not  ameliorate  and  greatly  modify  the  conditions  which  too  frequent- 
ly exist  in  a  vast  and  immediate  field  of  necessary  activity?  Too 
frequently,  in  discussions  of  these  problems,  we  undertake  to  cover 
too  great  an  area  of  disturbance.  A  sound  principle,  rationally  ap- 
plied, within  practical  limits  of  immediate  need  and  recognized  au- 
thority, is  a  more  profitable  subject  of  discussion  than  the  extension 
of  untried  and  unprecedented  proposals  to  the  widest  areas  of  dis- 
turbance. Sufficient  for  the  day  is  the  problem  thereof. 


Compulsory  Arbitration 

BY  SAMUEL  0.   DUNN,   CHICAGO,    ILL. 
EDITOR   OF   THE  RAILWAY   AGE   GAZETTE. 

The  president  of  the  American  Mining  Congress  has  asked  me 
to  write  a  paper  on  Compulsory  Arbitration,  and  especially  to  indi- 
cate my  opinion  as  to  the  advisability  of  advocating  some  method 
of  bringing  about  such  arbitration,  or  as  close  an  approximation 
to  it  as  would  be  practicable  under  our  existing  form  of  government. 
I  regret  that  I  have  not  had  opportunity,  since  I  consented  to  write 
something  on  the  subject,  to  get  together  a  larger  amount  of  ma- 
terial and  to  put  my  thoughts  in  satisfactory  form.  All  I  can  do 
is  to  outline  the  experience  of  a  few  countries  with  different  forms 
of  conciliation  and  arbitration,  and  indicate  in  a  general  way  the 
conclusion  which  it  would  seem  w'e  may  reasonably  draw  from  their 
experience  as  to  the  form  of  governmental  action  regarding  labor 
disputes  which  would  be  the  most  practicable  and  expedient  under 
the  conditions  prevailing  in  the  United  States. 

Governmental  intervention  in  disputes  betw'een  some  classes  of 
employers  and  employes  is  a  natural  result  of  the  development  of 
modern  industry.  When  industries  were  small,  and  there  were  no 
large  organizations  of  employers  or  employes,  the  public  had  little 
interest  in  controversies  between  labor  and  capital.  The  number  of 
men  employed  by  any  person  or  concern  was  insignificant,  and  it 
made  little  difference  to  the  public  if  there  was  a  lockout  or  strike. 

Owing  to  the  course  of  industrial  development  there  are  now 
many  concerns  which  employ  thousands  of  men.  In  certain  lines  of 
industry  there  are  organizations  including  many  business  concerns 
on  the  one  hand,  and  the  employes  of  many  concerns,  on  the  other 
hand.  A  lockout  or  strike  in  one  of  these  large  concerns  or  lines 
of  industry  may  result  in  many  millions  of  capital  and  many  thous- 
ands of  men  being  rendered  idle.  This  has  given  the  public  a 
proper  and  important  interest  in  disputes  between  capital  and  labor 
which  it  did  not  formerly  have.  The  public  feels  concern  regarding 
the  economic  waste  that  will  result  from  such  large  investments 
and  so  many  productive  workers  being  idle.  It  feels  a  special  con- 


COMPULSORY    ARBITRATION  231 

cern  regarding  the  possibility  of  lockouts  or  strikes  in  certain  in- 
dustries because  they  would  cut  it  off  from  the  very  necessities 
of  life. 

The  situation  as  respects  industries  producing  something  or 
rendering  some  service  the  unbroken  production  or  rendering  of 
which  is  not  essential  to  the  public  welfare  is  entirely  different  from 
the  situation  as  respects  industries  producing  something  or  render- 
ing some  service  the  unbroken  production  or  rendering  of  which  is 
essential  to  the  public  welfare.  The  public  would  not  feel  immedi- 
ately and  acutely  the  effect  of  the  closing  down  of  the  steel  mills, 
for  example.  It  would  feel  more  speedily  and  keenly  the  effect  of 
a  complete  closing  down  of  the  coal  mines,  especially  if  this  oc- 
curred in  a  season  when  the  demand  for  coal  was  great.  Still  more 
keenly  and  acutely  would  it  suffer  from  a  serious  interference 
with  the  operation  of  the  railways,  for  under  the  conditions  of 
modern  civilization  an  interruption  of  railw'ay  service  would  soon 
arrest  most  of  our  industrial  and  commercial  operations,  and  menace 
with  starvation  the  entire  population  of  many  communities. 

Whatever  may  be  true  as  to  industries  on  which  the  public 
is  not  dependent  for  necessaries  of  life,  it  seems  to  be  perfectly 
clear  that  the  government  has  the  right  and  duty  to  take  whatever 
steps  may  be  necessary  in  order  to  prevent  serious  interferences 
with  the  production  of  commodities  or  the  rendering  of  services 
on  which  the  comfort,  the  welfare  and  even  the  life  of  the  people 
are  dependent. 

A  distinction  is  drawn  in  law  between  public  utilities  and  other 
concerns,  this  distinction  being  based  on  the  theory  that  the  opera- 
tion of  only  the  former  is  of  primary  importance.  It  would  seem 
that  under  modern  conditions  the  uninterrupted  operation  of  coal 
mines  is  almost,  if  not  quite,  as  important  to  the  public  as  the  un- 
broken maintenance  of  the  service  of  public  utilities  and  railways, 
and  that  therefore  there  is  as  much  justification,  economic  and 
moral,  if  not  legal,  for  the  government  interference  in  disputes  be- 
tween coal  mine  operators  and  their  employes  as  between  railways 
and  public  utilities  and  their  employes. 

Whether  this  interference  should  take  the  form  of  compulsory 
arbitration  seems,  however,  very  questionable.  Compulsory  arbitra- 
tion involves,  first,  compelling  the  parties  to  submit  their  differences 
to  arbitration,  and  second,  compelling  them  to  accept  the  award 
made.  This  is  merely  a  modified  form  of  slavery.  To  require 


232  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

capitalists  to  give  employment  to  men  or  bodies  of  men  whom  they 
do  not  want,  at  wages  which  they  do  not  want  to  pay,  or  to  require 
an  individual  workingman  or  a  body  of  workingmen  to  work  for 
concerns  for  which  they  do  not  want  to  accept,  is  inconsistent  with 
enlightened  ideas  of  liberty.  It  is  a  form  of  industrial  conscription 
and  should  not  be  resorted  to  except  in  cases  as  extreme  as  those 
which  justify  military  conscription. 

It  is  not  necessary,  if  the  government  is  to  intervene  in  labor 
disputes,  whether  on  railways  or  in  coal  mines,  for  it  to  go  the 
length  of  adopting  compulsory  arbitration.  Furthermore,  the  ex- 
perience of  governments  which  have  tried  various  forms  of  inter- 
ference in  such  matters  has  indicated  that  attempts  at  compulsory 
arbitartion  are  not  likely  to  be  successful  and  that  other  forms  of 
governmental  intervention  are  likely  to  be  more  successful  and  to 
produce  more  satisfactory  results. 

The  government  which  has  made  the  most  thorough  and  inter- 
esting trial  of  compulsory  arbitration  is  that  of  New  Zealand.  It 
passed  a  compulsory  arbitration  law  in  1894,  entitled,  "An  act  to 
encourage  the  formation  of  industrial  unions  and  associations  and 
to  facilitate  the  settlement  of  industrial  disputes  by  conciliation  and 
arbitration."  The  original  act  and  the  various  amendments  were 
united  into  a  Compilation  Act  in  1905  and  various  amendments 
have  been  passed  since. 

The  act  as  it  stood  in  1905  provided  for  the  registration  with 
the  Secretary  of  Labor  of  industrial  unions  and  associations  of 
either  employers  or  workers.  Registration  made  the  union  or  asso- 
ciation a  body  corporate  and  rendered  both  it  and  its  members 
subject  to  the  jurisdiction  of  a  Conciliation  Board  and  an  Arbitra- 
tion Court.  Any  industrial  union  might  apply  at  any  time  for  the 
cancellation  of  its  registration,  but  such  cancellation  did  not  relieve 
the  union  or  any  of  its  members  from  the  obligation  of  any  agree- 
ment or  award  in  force  at  the  time,  nor  from  any  penalty  or  lia- 
bility. The  cancellation  of  registration  on  the  part  of  the  labor 
union  removed  it  from  the  jurisdiction  of  the  Conciliation  Board 
and  the  Arbitration  Court.  But  employers  could  not  thus  escape. 
They  had  to  accept  arbitration  if  their  employes  were  registered 
and  demanded  it.  Under  this  law',  therefore,  arbitration  was  in  a 
sense  voluntary  for  the  workers  but  compulsory  for  the  employers. 

The  colony  was  divided  into  eight  districts  in  each  of  which 
there  was  a  board  of  conciliation  consisting  of  three  or  five  mem- 


COMPULSORY    ARBITRATION  233 

bers,  one  or  two  being  elected  by  the  unions  of  employers,  and  an 
equal  number  by  the  unions  of  workers  and  the  third  or  fifth 
member  by  the  others  members,  a  president  and  two  assessors,  all 
appointed  by  the  governor  on  the  recommendation  of  the  unions  of 
employers  and  of  workers.  An  award  affected  not  only  labor  unions 
but  also  all  individual  w'orkers  working  for  an  employer  on  whom 
the  award  is  binding.  Unions  of  employers  or  of  workers  and 
individual  employers  are  liable  to  fines  not  exceeding  $2,500,  and 
individual  workers  to  fines  not  exceeding  $50,  for  breaches  of 
awards. 

In  practice  the  Conciliation  Boards  were  practically  ignored 
from  the  first,  and  almost  every  case  went  before  the  Arbitration 
Court.  In  the  absence  of  this  legislation,  which,  it  will  be  noted, 
applied  to  all  classes  of  commercial  and  industrial  undertakings, 
including  agriculture,  workingmen  would  have  looked  to  their  em- 
ployers for  improvements  in  their  conditions  of  work  and  raises  in. 
their  wages.  But  because  the  law  existed  almost  every  question 
regarding  conditions  of  work  and  wages  had  to  be  settled  by  the 
Arbitration  Court.  The  awards  and  agreements  which  have  been 
made  under  it  cover  a  great  variety  of  subjects,  including  minimum 
wages,  hours  of  labor,  permits  to  incompetent  workers,  limitation 
of  apprentices,  periods  of  apprenticeship,  piecework,  distribution  of 
work,  holidays,  meal  hours,  provision  of  tools,  modes  of  payment, 
notice  of  dismissal  scope  and  duration  of  awards,  interpretation  of 
awards,  extension  of  awards,  breaches  of  awards,  and  fines. 

In  the  earlier  years  of  the  operation  of  the  act  conditions  in 
New  Zealand  were  prosperous  and  the  aw'ards  usually  resulted  in 
advances  in  wages.  During  this  period  compulsory  arbitration  was 
in  high  favor  with  labor.  But  when  the  earlier  awards  began  to 
expire  conditions  were  not  so  prosperous,  and  when  the  workers 
appealed  to  the  Court  for  further  increases  in  wages  these  were 
often  refused.  Labor  then  speedily  began  to  show  dissatisfaction 
with  the  law  and  the  Court.  This  dissatisfaction  finally  manifested 
itself  in  an  acute  form.  In  November,  1906,  disregarding  the  pro- 
visions of  the  law,  the  employes  of  the  street  railways  of  Auckland 
declared  a  strike.  The  men's  grievances  was  that  a  conductor  had 
been  discharged  for  alleged  misconduct.  Both  the  company  and 
the  striking  employes  were  fined  for  having  violated  the  arbitration 
law.  In  February,  1907,  there  was  another  strike ;  this  time  in 


234  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

the  meat  packing  houses  at  Wellington.  In  this  case  266  strikers 
were  fined  $25  each. 

The  next  year  there  was  a  strike  among  the  coal  miners  of 
the  West  Coast,  which  lasted  for  eleven  weeks.  The  men  claimed 
that  seven  miners  who  had  been  dismissed  had  been  discharged  be- 
cause they  were  active  unionists  and  socialists.  The  company  of- 
fered to  take  them  back,  but  the  miners  refused  to  w'ork  unless 
some  arrangement  were  made  to  prevent  similar  occurrences  in 
future,  and  offered  the  remarkable  suggestion  that  when  men  were 
to  be  dismissed  they  should  be  selected  by  ballot  The  union  was 
cited  before  the  Arbitration  Court  and  fined  $375.  Being  unable 
to  collect  the  fine  from  the  union,  the  Court  proceeded  against  the 
men  individually  and  collected  about  $250. 

These  strikes  were  followed  by  others,  and  in  September,  1908, 
the  Minister  of  Labor  reported  that  since  1906  there  had  been  23 
strikes,  that  the  total  number  of  strikers  had  been  1,117,  the  num- 
ber of  men  rendered  idle  2,389,  the  duration  of  the  strikes  317  days, 
the  loss  of  wages  to  workmen  almost  $90,000,  and  the  loss  to  em- 
ployers about  $80,000.  The  next  year  there  was  a  coal  mine  strike 
for  a  very  curious  reason.  A  new1  workmen's  compensation  act 
was  to  go  into  effect.  The  coal  mine  operators  wished  to  insure 
themselves  against  loss  in  the  insurance  department  run  by  the 
colonial  government  itself.  The  government  insisted  that  before 
it  would  write  the  insurance  the  employes  of  the  mines  must  submit 
to  physical  examination ;  and  the  men  struck  rather  than  submit  to 
physical  examination.  The  government  then  yielded  and  authorized 
its  insurance  department  to  issue  policies  without  examination.  Soon 
afterward  there  was  a  strike  of  the  miners  in  the  government  coal 
mines  at  Point  Elizabeth. 

The  chief  purpose  of  the  arbitration  law  was  to  prevent  lock- 
outs and  strikes.  It  had  succeeded  in  preventing  lockouts  but  had 
failed  to  prevent  strikes.  Therefore,  it  was  amended  on  January 
i,  1909,  to  provide  that  every  worker  who  was  a  party  to  an  un- 
lawful strike  should  be  fined  not  exceeding  $50  and  every  employer 
who  was  a  party  to  an  unlawful  lockout  should  be  fined  not  ex- 
ceeding $2,500.  The  Boards  of  Conciliation  were  abolished  and 
Councils  of  Conciliation  substituted.  Three  permanent  commission- 
ers of  conciliation  are  appointed  by  the  government.  In  case  of  a 
dispute  one  of  them  goes  to  the  scene  and  tries  to  effect  a  settle- 
ment. If  he  fails  he  sets  up  a  Council  of  Conciliation  consisting  of 


COMPULSORY    ARBITRATION  235 

one,  two  or  three  assessors  representing  the  employers  and  an  equal 
number  representing  the  workers.  Every  dispute  must  be  referred 
to  such  a  council  before  it  can  be  carried  to  the  Arbitration  Court 
There  is,  however,  a  way  by  which  the  workers  may  altogether 
evade  the  purpose  of  the  act  and  strike  without  danger  of  punish- 
ment. After  an  award  applying  to  them  has  expired  they  may 
cancel  their  registration,  after  which  they  cease  to  be  subject  tc 
the  law. 

I  have  no  detailed  information  on  the  subject,  but  I  understand 
that  the  law  as  amended  in  1909  has  worked  as  badly  as  the  original 
act  and  that  strikes  have  continued  to  occur  in  New  Zealand.  In 
other  words,  compulsory  arbitration  there  has  failed  to  prevent 
strikes,  and  the  government  has  not  even  been  successful  in  all 
cases  in  enforcing  the  awards  made  by  the  Arbitration  Court.  In 
this  respect,  as  in  the  ownership  and  operation  of  mines  and  rail- 
ways, and  in  most  other  respects,  paternalistic  government  in  New 
Zealand  has  been  very  much  less  of  a  success  than  the  advocates 
of  similar  government  in  this  country  would  have  us  believe. 

The  British  colonies  have  tried  within  the  last  tw'o  decades 
many  experiments  with  social  and  labor  legislation.  That  in  New 
Zealand  with  compulsory  arbitration  is  one  of  them.  Another  of  the 
most  interesting  and  instructive  of  them  has  been  that  made  by  our 
neighbor,  Canada,  by  the  passage  and  administration  of  the  "Indus- 
trial Disputes  Investigation  Act,"  more  familiarly  known,  after  its 
author,  as  the  "Lemieux  Act."  This  measure  is  of  especial  interest 
to  those  engaged  in  the  mining  of  coal  because  its  enactment  grew 
out  of  a  coal  mine  strike  in  Lethbridge  in  the  southern  part  of 
Province  of  Alberta.  This  strike  began  in  the  summer  of  1906 
and  continued  until  late  in  the  fall,  and  the  people  of  Western 
Canada  suddenly  awakened  to  the  fact  that  on  the  verge  of  a  north- 
ern winter  they  were  confronted  with  the  danger  of  a  serious  fuel 
famine.  The  strike  was  finally  settled.  But  the  impression  made 
on  the  public  mind  was  so  deep  that  legislation  to  prevent  the  re- 
currence of  such  conditions  was  passed  and  went  into  effect  before 
the  end  of  March,  1907. 

The  Lemieux  Act  applies  to  railroads,  street  railways  and  other 
public  utilities  and  to  mines  of  every  class,  metalliferous  as  well  as 
coal.  It  provides  that  before  a  lockout  or  strike  can  legally  take 
place  in  any  of  these  industries  the  parties  must  refer  their  differ- 
ences to  a  board  for  hearing.  The  party  about  to  lockout  or  strike 


236  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

must  give  notice  to  the  government  of  its  intention,  together  with 
a  statement  of  the  nature  of  the  controversy.  The  Minister  of 
Labor  then  calls  on  each  party  to  name  a  member  of  the  board. 
The  two  members  chosen  by  them  are  given  an  opportunity  to  agree 
on  a  chairman.  If  they  fail  to  do  so  within  a  specified  time  the 
Minister  of  Labor  appoints  the  chairman ;  and  if  either  party  fails 
to  name  a  member  of  the  board  to  represent  it  the  Minister  of 
Labor  appoints  him  also. 

The  Board  as  thus  constituted  has  almost  the  powers  of  a 
court.  It  may  subpoena  witnesses,  compel  the  production  of  docu- 
ments, and  take  testimony ;  but  its  duty  is  primarily  that  of  a  con- 
ciliation and  mediation  board.  If  the  board  can  bring  about  a  settle- 
ment by  conciliation  it  prepares  its  report  and  sends  it  to  the  gov- 
ernment. If  it  cannot  do  this  it  takes  testimony  and  prepares  a 
report  summarizing  it,  and  also  sets  forth  its  conclusions  as  to  the 
merits  of  the  controversy  and  its  recommendations  to  the  parties 
and  gives  this  report  to  the  public. 

There  the  intervention  of  the  government  ends.  The  law  does 
not  require  acceptance  of  the  award.  According  to  all  reports  this 
very  simple  measure  has  worked  well.  Hon.  W.  L.  MacKenzie 
King,  formerly  Minister  of  Labor  of  Canada,  delivered  an  address 
before  the  Railway  Business  Association  in  New'  York  on  Decem- 
ber 19,  1912,  in  which  he  said  that  during  the  five  and  one-half 
years  up  to  September,  1912,  there  had  been  132  applications  made 
for  the  formation  of  conciliation  boards,  and  that  strikes  were  avert- 
ed in  all  but  15  cases.  Of  these  controversies,  40  were  in  coal 
mines,  10  in  metalliferous  mines,  53  on  railways  and  10  on  street 
railways. 

The  only  similar  federal  law  which  w'e  have  in  this  country  is 
the  Erdman  Act,  as  amended  by  the  Newlands  Act.  This  measure 
applies  only  to  disputes  between  railway  companies  and  railway  em- 
ployes directly  concerned  with  the  operation  of  trains.  It  creates 
a  permanent  mediation  and  conciliation  board  of  three  members. 
In  case  of  a  dispute  which  may  lead  to  a  lockout  or  strike  either 
of  the  parties  may  appeal  to  this  board,  which  will  then  tender  its 
good  offices.  But  its  advances  may  be  legally  repulsed,  for,  unlike 
the  Canadian  law,  the  act  does  not  prohibit  a  lockout  or  strike  in 
advance  of  conciliation  or  arbitration.  If  the  good  offices  of  the 
federal  mediators  are  accepted  they  proceed  to  the  scene  of  the 
controversy  and  try  to  bring  about  an  agreement.  If  they  are  un- 


COMPULSORY    ARBITRATION  237 

successful  in  this  the  law  provides  that  the  parties  may  resort  to 
arbitration  by  a  board  composed  of  two  representatives  of  the  rail- 
ways, two  representatives  of  the  employes  and  two  other  persons 
chosen  by  them.  If  the  representatives  of  the  railways  and  employes 
do  not  agree  on  the  impartial  arbitration  they  may  be  selected  by 
the  board  of  mediation  and  conciliation.  Once  the  controversy  has 
been  submitted  to  arbitration  the  award  must  be  accepted  by  the 
parties  and  put  into  effect  for  one  year. 

On  the  whole,  the  results  of  the  operation  of  this  act  have  been 
good.  Mediation  and  arbitration  under  it  have  averted  many  seri- 
ous strikes.  But  the  law  has  grave  defects.  Why  should  it  apply 
only  to  employes  of  railways  directly  concerned  in  the  operation 
of  trains?  A  strike  in  railway  shops  might  in  a  very  short  time 
cause  a  serious  interruption  of  traffic.  And  why  should  the  law 
apply  only  to  railways  and  their  employes?  A  coal  mine  strike 
may  cause  as  much  loss  and  suffering  to  the  public  as  a  railway 
strike.  Finally,  why  should  lockouts  or  strikes  be  permitted  on 
railways  and  public  utilities  and  in  coal  mines  before  the  questions 
in  controversy  have  been  submitted  to  somebody  representing  the 
public?  The  public  has  even  more  at  stake  than  either  of  the  im- 
mediate parties.  May  not  the  public,  therefore,  properly  demand 
that  at  least  all  the  facts  shall  be  given  to  it  before  its  rights  are 
disregarded  and  its  interests  sacrificed? 

Another  criticism  which  has  been  forcibly  urged  against  the 
Erdman-New'lands  law  is  that  while  conciliation  and  arbitration 
under  it  may  prevent  lockouts  and  strikes,  they  do  not  necessarily 
result  in  fair  settlements.  Of  the  six  members  of  the  arbitration 
board  as  now  constituted,  only  two  are  in  any  sense  impartial.  The 
other  four  are  avowed  partisans.  And  the  only  two  who  are  im- 
partial are  never  experts,  for  they  are  always  chosen  from  some 
business  or  profession  entiely  different  from  that  in  which  the  dis- 
pute has  arisen.  In  these  circumstances  the  award  is  necessarily 
made  by  the  two  impartial  arbitrators  and,  as  they  lack  expert 
knowledge,  and  as  the  time  allowed  for  the  proceedings  is  short, 
the  usual  result  is  a  mere  splitting  of  the  difference,  which  settles 
no  principles  and  always  results  in  some  increases  in  railway  wages, 
whether  fair  or  not. 

The  most  thorough  investigation  of  the  railway  labor  situation 
in  this  country  ever  made  was  that  of  the  arbitration  board  which 
settled  the  controversy  between  the  eastern  railways  and  their  loco- 


238  PROCEEDINGS    AMERICAN    MINING    CONGRESS 

motive  engineers  some  two  years  ago.  This  board  was  not  organ- 
ized under  the  Erdman  Act,  but  was  composed  of  one  representative 
of  labor,  one  representative  of  the  railways  and  five  impartial  arbi- 
trators, all  of  whom  were  very  prominent  business  and  professional 
men.  So  impressed  was  this  board  by  the  shortcomings  of  the 
Erdman  Act  and  the  dangers  of  serious  railway  strikes,  that  it 
recommended  legislation  forbidding  such  strikes  prior  to  arbitra- 
tion and  providing  for  federal  and  state  w'age  commissions  to  deal 
with  labor  controversies  on  railways. 

The  most  serious  shortcomings  of  the  Erdman-Newlands  law 
is  that  it  does  not  prohibit  strikes  and  lockouts  before  arbitration : 
and  the  best  feature  of  the  Lemieux  Act  of  Canada  is  that  it  does 
prohibit  them  before  the  facts  regarding  the  questions  involved 
have  been  given  a  thorough  airing. 

With  your  permission  I  shall  suggest,  with  some  difference,  a 
plan  for  legislation  which  I  believe  would  be  better  than  either  the 
Erdman-Newlands  Act  or  the  Lemieux  Act.  The  Erdman-New- 
lands Act  should  be  so  amended  as  to  make  it  apply  to  both  con- 
troversies between  railways  and  any  or  all  of  their  employes,  and 
between  coal  mining  companies  and  their  employes.  Whether  its 
extension  to  disputes  in  coal  mines  would  be  constitutional  is  a 
question  which  I  expressly  refrain  from  discussing  at  this  point. 
The  present  federal  mediation  and  conciliation  board  should  be  re- 
tained with  its  present  functions,  but  its  jurisdiction  should  be 
extended  in  the  same  measure  as  the  provisions  of  the  law  under 
which  it  acts.  Strikes  and  lockouts  in  advance  of  arbitration  should 
be  prohibited  in  the  industries  mentioned.  In  case  of  arbitration 
the  arbitration  board  should  be  composed  of  one  representative  of 
the  employers,  one  representative  of  the  employes,  one  member  of 
the  Interstate  Commerce  Commission,  one  member  of  the  new  Inter- 
state Trade  Commission,  and  a  fifth  member  to  be  chosen  by  these 
four.  The  testimony  taken  by  the  board,  together  with  its  conclu- 
sions and  recommendations,  should  be  made  public,  but,  as  in 
Canada,  the  award  should  not  be  legally  binding  on  the  parties. 

What  would  be  the  advantage  of  such  legislation?  It  would 
provide  machinery  for  governmental  intervention  by  which  agree- 
ments between  parties  themselves  might  be  brought  about.  It  would 
prevent  lockouts  and  strikes  until  after  the  facts  regarding  all  the 
points  in  controversy  had  been  laid  before  the  public.  It  would 
secure  arbtiration  by  a  board,  a  majority  of  whose  members  would' 


COMPULSORY    ARBITRATION  239 

represent  the  public,  and  which  at  the  same  time  would  be  so  con- 
stituted that  we  may  fairly  assume  that  it  w'ould  act  with  expert 
knowledge.  And  after  the  parties  had  had  time  to  think  deliber- 
ately about  the  points  in  controversy,  and  after  a  board  as  thus  con- 
stituted had  ascertained  the  facts  and  presented  them  to  the  parties 
and  made  them  public,  together  with  its  recommendations,  it  is  al- 
most inconceivable  that  any  concern  or  body  of  workingmen  would 
have  the  hardihood  to  reject  the  board's  findings  and  recommenda- 
tions and  resort  to  a  lockout  or  strike. 

That  such  federal  legislation  would  be  constitutional  as  applied 
to  railways  there  cannot  be  any  serious  doubt.  Whether  it  would 
be  constitutional  as  applied  to  coal  mines  is  a  different  question. 
But  if  such  federal  legislation  as  to  disputes  in  coal  mines  would  not 
be  constitutional,  unquestionably  similar  state  legislation  w'ould  be 
so.  Furthermore,  similar  state  legislation  applying  to  public  utili- 
ties of  all  kinds  would  be  constitutional. 

Would  not  such  regulation  of  the  relations  between  capital  and 
labor  secure  all  of  the  advantages  of  compulsory  arbitration  and  at 
the  same  time  steer  clear  of  its  disadvantages?  New  Zealand  has 
tried  both  compulsory  arbitration  and  compulsory  acceptance  of 
awards.  Canada  has  tried  compulsory  arbitration  with  voluntary 
acceptance  of  awards.  Under  the  Erdman-Newlands  Act  we  have 
tried  voluntary  arbitration  with  compulsory  acceptance  of  awards. 
In  my  opinion  which  would  be  best  suited  to  our  own  conditions 
and  needs  would  be  that  or  compulsory  arbitration  with  voluntary 
acceptance  of  awards,  carried  out  under  some  such  plan  as  that 
which  I  have  outlined. 


YC  01631     yf 


279623 


, 


UNIVERSITY  OF  CALIFORNIA  LIBRARY 


